AGGREGATE PLANNING- Worked answers for 8-14

AGGREGATE PLANNING- Worked answers for 8-14 - AGGREGATE...

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AGGREGATE PLANNING OLD EXAM QUESTIONS (The answer key is at the end of this document.) The Milton Company must develop an aggregate plan to meet the following five months of demand: Month 1 2 3 4 5 Demand (Units) 100 50 50 200 50 Plan B 80 80 80 80 80 Inventory (aggregate) -20 (cannot carry negative inventory) 8. Someone has just proposed an alternate plan for these five forecasted months: keep the perfectly level production strategy, but only produce 80 units a month. This proposed strategy is being called “Plan B”, while the original 100 units-a-month plan is being called “Plan A”. Which of the following statements is (are) true? I. Plan A has higher inventory levels than Plan B. True (on month 1, plan A will have 0 inventory because the demand is 100, producing 100 units. However plan B, producing 80 units will not meet the demand of 100 units, causing a shortage of 20 units. Therefore the answer is true that the inventory level on plan A is higher than plan B.) II.
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AGGREGATE PLANNING- Worked answers for 8-14 - AGGREGATE...

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