A local company makes athletic clothing and they are preparing aggregate product

Question

A local company makes athletic clothing and they are preparing aggregate production plans on a quarterly basis for the coming year for their line of women's wear. They have the following information available to develop a level capacity and a matching (chase) demand plan:

(Assume that pattern of demand repeats each year, that is the demand in quarter 4 of the previous year was 13,000 units)

Number of working days per quarter = 65 days

Number of hours per day per person = 8 hours

Labor to produce one unit = 5 hours

Demand for four quarters respectively:

12,300, 12,500, 12,200, 13,000 units

Cost of hiring a worker = $800

Cost of laying off a worker = $500

Inventory carrying cost per unit per year = $60

For a matching demand plan, how many workers are needed each quarter respectively?

A) 119, 121, 118, 125

B) 119, 121, 125, 134

C) 119, 118, 134, 125

D) 121, 125, 134, 138

E) 121, 124, 130, 128

Explanation / Answer

Time taken per worker to produce 1 unit = 5 hours

Therefore, number of units which can be produced by 1 worker per day of 8 hours = 8/5 = 1.6 units

Therefore, number of units which can be produced by 1 worker per quarter of 65 days = 1.6 x 65 = 104 units

Number of workers needed to produce 12300 units in 1st quarter = 12300 / 104 = 118.26 ( 119 rounded to next higher whole number )

Number of workers needed to produce 12500 units in 2nd quarter = 12500/104 = 120.19 ( 121 rounded to next higher whole number )

Number of workers needed to produce 12200 units in 3rd quarter = 12200/ 104 = 117.30 ( 118 rounded to nearest whole number )

Number of workers needed to produce 13000 units in 4th quarter = 13000/104 =125

ANSWER : A ) 119. 121, 118 , 125

ANSWER : A ) 119. 121, 118 , 125

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