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International Business Operations Management
A company produces to a seasonal demand, with the forecast for the next 12 months as given below.
Month
Demand
January
600
February
700
March
800
April
May
June
500
July
August
September
October
900
November
December
The present labor force can produce 500 units per month. Each employee added can produce an additional 20 units per month and is paid $1000 per month. The cost of materials is $30 per unit. Overtime can be used at the usual premium of time and a half for labor up to a maximum of 10 percent per month. Inventory-carrying cost is $50 per unit per year. Changes in production level cost $100 per unit due to hiring, line changeover costs, and so forth. Assume 200 units of initial inventory. Extra capacity may be obtained by subcontracting at an additional cost of $15 per unit over and above the company's producing them itself on regular time.
1. Provide a detailed cost breakdown for using a level vs. a chase strategy to meet the increased demand.
2. Which strategy do you recommend?
3. How much savings would result from the plan you recommend?
3-4 Scholarly written pages in APA format with 3-4 scholarly references.
Verified Expert
The current report is a solution to production planning problem.The objective is to find the best strategy among the level and chase strategies. Calculations are done based on the data provided and finally shown that the chase strategy is the right and best solution from cost point of view. savings also shown.
I just want to confirm the paper will be scholarly written in APA format and the answer is written in paragraph format, i.e. not just different tables with the answers in them can you please verfiy again - paper will be scholarly written in APA format and the answer is written in paragraph format, i.e. not just different tables with the answers in them? The given question is a problem - there is no theory associated with the problem - hence you did best to explain the steps and procedures in paragraph format with calculations in excel sheet. Of course formatting is done in APA style- Still if any specific changes required in accordance to problem specifications , i will approach you. But broadly it is the solution for the given problem in numerals and remarks format.
The assignment in management is a two part assignment dealing 1.Theory of function of management. 2. Operations and Controlling.
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