Question: Explain whether a Level or Chase plan is more suitable for the demand pattern experienced by this particular business, which incidentally relies on highly skilled


Explain whether a Level or Chase plan is more suitable for the demand pattern

experienced by this particular business, which incidentally relies on highly skilled

workers in the production process. Assume a starting workforce of 7 and that

fractional workers are permissible.

You should support your answer with numerical data derived from Table 3. In

comparing the costs, state any other assumptions made. 

Table 3:

Units produced per worker

per period 200

Hiring cost per worker £450

Firing cost per worker £150

Inventory

Holding Cost per

unit per period

£7.50

Shortage Cost

per unit per

period

£10.50


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