Question: Consider the following aggregate planning problem for one quarter: Assume that there is no initial inventory and a forecasted demand of 1,250 units in each

Consider the following aggregate planning problem for one quarter:

Production capacity/month Production cost/unit SUB- REGULAR TIME OVERTIME CONTRACTING 1,000 $5 200

Assume that there is no initial inventory and a forecasted demand of 1,250 units in each of the 3 months. Carrying cost is $1 per unit per month. Solve this aggregate planning problem for Production Manager Victor Shi using the transportation method.

Production capacity/month Production cost/unit SUB- REGULAR TIME OVERTIME CONTRACTING 1,000 $5 200 $7 150 $8

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The transportation method is a type of linear programming method used for solving aggregate planning problems where an objective function needs to be minimized or maximized Aggregate planning refers t... View full answer

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