1. Set up this problem as an aggregate planning problem and determine the minimum cost aggregate plan. Briefly state the trade-off analysis you used. Calculate the total cost. Note: if demand is less than the number of permanent nurses in a quarter, the nurses will still be paid but the idle time will be used as paid holidays anchor for further training.

2. What factors, other than cost, should be considered in this aggregate planning? Explain.

Banner Good Samaritan Medical Center in Phoenix, Arizona, is a 662-bed hospital. Like other hospitals, the number of its patients increases in the winter. The full-time equivalent (FTE) nurse requirements for Q1 to Q4 of next year are forecasted to be Ql: 1,300 FTE, Q2: 1,000 FTE, Q3: 800 FTE, and Q4: 1,000 FTE. Banner Good Samaritan employs 1,000 FTE permanent nurses throughout the year. During peak season, it can employ up to 500 additional FTE temporary nurses from local temporary' personnel agencies. Also, it can use up to 500 FTE of overtime (hours worked beyond an eight-hour shift in a day). Each FTE permanent nurse receives an average of $8,000 a quarter. Each FTE of overtime work receives $12,000 a quarter. Each Temporary FTE receives $8,000 a quarter, but needs an average of $1,000 for training (charged to the first quarter of employment).