Question: A company wants to develop a level production plan. The beginning inventory is zero. Demand for the next four periods is given in what follows.

A company wants to develop a level production plan. The beginning inventory is zero. Demand for the next four periods is given in what follows.

a. What production rate per period will give a zero inventory at the end of period 4?

b. When and in what quantities will back orders occur?

c. What level production rate per period will avoid back orders? What will be the ending inventory in period 4?

Period

1

2

3

4

Total

Forecast demand

9

5

9

9

Planned production

Planned inventory

0

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