ch3_Agg_P_LP_Excel

ch3_Agg_P_LP_Excel - Aggregate Planning, Linear Programming...

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Aggregate Planning, Linear Programming and Excel Solver Input Demand forecast for each quarter, number of workers available in the beginning, hiring and firing costs per worker, straighttime and over time costs per hour, inventory holding and backorder costs per unit, productivity (units per hour), working hours (hours per day and days per quarter) and beginning inventory. Output (Decision Variables) Decide for each quarter: number of workers hired/fired, overtime hours, number of units in the ending inventory and backorder. Objective Minimize the total cost of straight-time, overtime, hiring, firing, inventory holding and backorder Relationships 1. Inventory at the beginning of the current quarter (except the first quarter) = positive inventory of the previous quarter – units backordered in the previous quarter 2. Number of workers available in the current quarter = number of workers employed in the previous quarter + number of workers hired in the current quarter – number of workers fired in the current quarter 3. Regular production hours in a quarter = (Number of workers available in the current quarter) × (Number of working hours per day) × (Number of working days per quarter) 4. Actual number of units produced in a quarter = (Regular production hours + overtime production hours) × (productivity in units per hour) 5. Inventory at the end of the current quarter = Actual number of units produced in the current quarter + Inventory at the beginning of the current quarter – Demand forecast of the current quarter 6. Inventory at the end of the current quarter = positive inventory of the current quarter – units backordered in the current quarter 7. Costs: Straight-time cost=(regular production hours) × (straight-time cost per hour) Overtime cost=(overtime production hours) × (overtime cost per hour) Inventory holding cost=(ending inventory) × (holding cost per unit) Backorder cost=(units backordered) × (backorder cost per unit) Hiring cost=(number of workers hired) × (hiring cost per worker) Firing cost=(number of workers fired) × (firing cost per worker) The Problem
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ch3_Agg_P_LP_Excel - Aggregate Planning, Linear Programming...

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