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You are the operations manager for an OEM manufacturing plant that produces YBOX game consoles. Based on the sales record from 2014, the marketing manager forecasts the demand for Jan- June of 2015 as the following: JAN. FEB. MAR. APR. MAY JUNE 2,500 3,000 4,000 3,500 3,500 3,000 Relevant information includes: Production Time 1 hour per unit Average labor cost $10 per hour Workweek 5 days, 8 hours per day Days per month 20 work days per month Beginning inventory 500 units Safety stock One-half month Shortage cost $20 per unit per month Carrying cost $5 per unit per month As the operations manager, you prefer to keep a constant workforce and production level, absorbing variations in demand through inventory excesses and shortages. Demand not met is carried over to the following month. You currently have 21 workers.

Questions:

a. Which aggregate plan will you use to produce the forecasted demand for YBOX game consoles?

b. What is the total cost for the chosen plan?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91881379

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