Aggregate Planning and Scheduling

1. (Chapter 11) A retailer experiences a seasonal demand pattern for its services. Labor requirements over a typical six-month period follow (10 pts):

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(see chart in attached file)

Costs associated with operations are as follows:
Wages = $3,000 per worker per month
Hiring cost = $1,000 per worker
Layoff cost = $500 per worker
Overtime cost = $4,500 per worker per month

The current workforce level is 15 workers and workers are paid whether they are utilized or not. Use the above data to answer the following questions:

a. The total cost of the staffing plan (including the cost of regular wages, hiring, and layoffs) using a chase strategy with hiring and layoffs, but no overtime, is:

(see chart in attached file)

b. The total cost of the staffing plan, using a level strategy, but allowing for 20% overtime, and the undertime is paid for, is:

(see chart in attached file)
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Attachments

Problem8.doc