Question: Consider the following and answer the questions. A manager would like to know the total cost of a chase strategy that matches the forecast below
Consider the following and answer the questions.
A manager would like to know the total cost of a chase strategy that matches the forecast below using a steady regular production rate of units per month, a maximum of units per month of overtime, and subcontracting as needed to make up any shortages. Initial inventory is zero.
Regular cost per unit $
Overtime cost per unit $
Subcontracting cost per unit $
We are using a chase strategy, ie we will use overtime or subcontracting in a given month to make up any shortages in that month.
Month
Forecast
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Which months will experience a backlog?
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All Of Them
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How many units will it take to eliminate all the backlogs?
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How many months will require subcontracting?
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What is the total cost of the strategy?
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Will there be excess inventory left over at the end of period
Group of answer choices
Yes
No
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