A manager has prepared a forecast of expected aggregate demand for the next six months. Develop an aggregate plan to meet this demand given this additional information: A level production rate of 100 units per month will be used. Backorders are allowed, and they are charged at the rate of $8 per unit per month. Inventory holding costs are $1 per unit per month in ending inventory. 

Determine the cost of this plan if the regular time cost is $20 per unit and the beginning inventory is zero.
Month Forecast
1 80
2 100
3 120
4 110
5 100
6 90

Answer rating: 100% (QA)

Aggregate Plan Period 1 2 3 4 5 6 Forecast 80 100 120 110 100 9... View the full answer