Question

he following information relates to a company’s aggregate production planning activities: Quarter Demand Forecast 1 37,500 2 45,000 3 25,000 4 62,500 Beginning Workforce = 125 workers Production per Employee = 500 units per quarter Hiring Cost = $750 per worker Firing Cost = $1,500 per worker Inventory Carrying Cost = $10 per unit per quarter If a level production strategy is used the number of units in inventory at the end of quarter 3 is

Answer 1

Answer:

20,000 units

Explanation:

Number of units in inventory at the end of quarter 3

= 3(42,500)

=127,500

Hence:

127,500- 37,500-45,000-25,000

= 20,000 units

Therefore if production strategy is used the number of units in inventory at the end of quarter 3 is 20,000 units