MT%20Extra%20Credit-W-12

MT%20Extra%20Credit-W-12 - hours in an average quarter. The...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Midterm Extra Credit Problem The following information pertains to a company that produces a single product line and uses a four quarter aggregate planning horizon: Regular time production capacity = 1,000 units per quarter at a cost of $600/unit; Overtime production capacity = 200 units per quarter at a cost of $850/unit; Beginning inventory = 50 units; Inventory holding cost = $160/unit/year; Backordering cost = $300/unit backordered; Beginning workforce size = 140; Hiring cost = $1,000 per worker; Layoff cost = $1,400 per worker. The direct labor content of each unit of the product is 100 hours and there are 500 regular time
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: hours in an average quarter. The overtime wage rate is 150% of regular time pay. The demand forecasts for the next four quarters are, respectively,700, 1300, 1100 and 850 units. 1. Formulate an appropriate mathematical model for finding the optimal aggregate plan. At the outset, clearly define all decision variables used in your model, then algebraically construct the objective function and all constraints. 2. Solve your model above using any appropriate software and outline the optimal aggregate plan in a tabular format....
View Full Document

This note was uploaded on 03/16/2012 for the course OPM 325 taught by Professor Ruodu during the Spring '12 term at Drexel.

Ask a homework question - tutors are online