Unformatted text preview: ges be an issue if demand
Other Costs: payroll, overtime, subcontracting.
Other 5 Workforce Cost
Workforce $ Cost Holding and Back-Order Costs
Holding Slope = Ci Slope = CP Back-orders Positive inventory
Inventory 6 Example
The Densepack (manufacturer of disk drives) is
interested in determining work force and production
levels for the next 6 month, starting January. Forecasted
demands are 1280, 640, 900, 1200, 2000, and 1400.
Ending inventory at the end of December is 500 and the
firm would like to have 600 units on hand at the end of
June. There are currently 300 workers employed in the
plant. Find monthly production levels. Example
6(June) Net Predicted Demand
2000 Net Cumulative Demand
7520 7 Costs
Cost of hiring one worker - $500
Cost of firing one worker - $1000
Cost of holding one unit of inventory for one month - $80
Aggregate production units is the number of items
produced per worker.
It is observed that for...
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- Spring '14
- Economics, Worker Produced Production