Chris Fisher owner of an Ohio firm that manufactures display

Chris Fisher, owner of an Ohio firm that manufactures display cabinets, develops an 8-month aggregate plan, Demand and capacity (in units) are forecast as follows: The cost of producing each unit is $1,000 on regular time, $1,200 on overtime, and $ 1,800 on a subcontract. Inventory carrying cost is $ 200 per unit per month. There is no begging or ending inventory in stock, and no backorders are permitted from period to period. Let the workforce vary by using regular time first, then overtime, and then subcontracting. This plan allows no backorders or inventory. Minimizing cost by producing exactly what the demand is each month, the total cost is S (enter your response as a whole number).

Solution

` jan feb mar apr may june july aug regular 230 265 290 300 290 290 300 310 ot 25 24 28 24 30 26 30 30 sc 12 16 15 17 17 19 24 20 regular/ unit 1000 demand 255 304 323 305 320 318 350 360 ot/ unit 1200 sc/ unit 1800 total cost 260000 320800 350600 306000 326000 324800 372000 382000 total cost 2642200