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Angela has started a business creating personalized bobble-heads. Below is her current schedule and anticipated demand.

Month Expected Demand Production Days Demand/Day

Jan. 700 24 30

Feb. 1200 20 60

March 850 22 39

April 1100 21 53

May 970 23 43

Inventory carrying costs are $3/unit. Regular time labor is $9/hr. Workers work for 8 hours/day. It takes 2 hours to complete one bobble-head. The subcontracting cost/unit is $22. Hiring employees cost $200 and firing them cost $400.

If Angela wants to have a constant workforce, utilizing a pure level strategy. She currently employees 11 workers in the production process. The total cost of this aggregate plan are most nearly,

A. 880

B. 7920

C. 1630

D. 88750

E. 87120

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92597444

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