1. A high-valued item has a tracking signal target (acceptable limit) of +/- 4. For the first six months of this year, demand has been 80, 92, 71, 83, 90, 102 and the forecast was 78, 79, 83, 79, 80, 83. Compute the tracking signal for each month and indicate whether corrective action is appropriate.

2. You are a new forecasting manager and are given the following report with this data representing past demand. January 74, February 79, March 80, April 90, May 105, June 142, July 122. What forecasting method would you likely use to predict demand for August and September? Calculate the forecast for these two months.

3. Stevens Company manufactures automobile tires. They use a chase strategy and rely on subcontracting when necessary to meet demand. Develop a production plan for the following monthly forecast: 80, 90, 70, 80, 90, 100. The company starts out with 8 workers and each worker can make 10 tires per month. Subcontracting capacity is unlimited. Hiring workers cost $50 per worker, firing workers cost $100 per worker, and subcontacting costs $4 per tire. COME UP WITH THE LOWEST COST PLAN AND IDENTIFY THE COST OF YOUR PLAN.