Question

A manufacturer of industrial seafood processing equipment wants you to develop an aggregate plan for the four quarters of the upcoming year using the following data on demand and capacity.


Quarter Units Regular Time Over- time Sub- contract Initial inventory Regular time cost 250 units $1.25/unit
1 200 400 80 100 Overtime cost $1.50/unit
2 750 400 80 100 Subcontracting cost 2.00/unit
3 1200 800 160 100 Carrying cost $0.50/unit/quarter
4 450 400 80 100 No back ordering is allowed

a. Find the optimal plan using the transportation method.

b. What is the cost of the plan?

c. Does any regular time capacity go unused? How much in what periods?

d. What capacity went unused in this solution? (List in detail.)

Answer

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