Hill's operations manager (see Problems 13.3 through 13.5) is also considering two mixed strategies for January- August:
Question:
Hill's operations manager (see Problems 13.3 through 13.5) is also considering two mixed strategies for January- August: Produce in overtime or subcontracting only when there is no inventory.
➤ Plan D: Keep the current workforce stable at producing 1,600 units per month. Permit a maximum of 20% overtime at an additional cost of $50 per unit. A warehouse now constrains the maximum allowable inventory on hand to 400 units or less.
➤ Plan E: Keep the current workforce, which is producing 1,600 units per month, and subcontract to meet the rest of the demand. Evaluate plans D and E and make a recommendation.
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To evaluate Plans D and E we need to compare the costs associated with each plan Plan D Produce in Overtime With Plan D Hill would keep the current wo...View the full answer
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