A company is interested in developing a quarterly aggregate production plan but they are not sure if a level strategy with backorders or a chase strategy would be better They have the following information available regarding their production operation Hiring Cost (per unit increase) $40 Firing (per unit decrease) $80 Inventory Cost (per unit) $40 Stockout (per unit) $150 Production (Labor) cost (per unit) $30 Subcontracting cost (per unit) $60 Previous quarter's production 1300 Previous quarter's ending inventory 0 Quarter forecasts are 4000, 2000, 4000 and 5000, respectively Suppose that you want to use a chase plan What is the labor cost of quarter 1 (Do not round your intermediate calculations Round your final answer to the nearest whole number ) A 90000 B 120000 C 60000 D 150000 E None of these

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Question: A company is interested in developing a quarterly aggregate production plan but they are not sure if a level strategy with backorders or a chase

A company is interested in developing a quarterly aggregate production plan but they are not sure if a level strategy with backorders or a chase strategy would be better. They have the following information available regarding their production operation:

Hiring Cost (per unit increase)	$40
Firing (per unit decrease)	$80
Inventory Cost (per unit)	$40
Stockout (per unit)	$150
Production (Labor) cost (per unit)	$30
Subcontracting cost (per unit)	$60
Previous quarter's production	1300
Previous quarter's ending inventory	0

Quarter forecasts are 4000, 2000, 4000 and 5000, respectively.

Suppose that you want to use a chase plan. What is the labor cost of quarter 1? (Do not round your intermediate calculations. Round your final answer to the nearest whole number.)

A. 90000

B. 120000

C. 60000

D. 150000

E. None of these

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