Question: Fisher - Price is developing an aggregate plan for a popular line of power wheels kids ride - on toys. The company has collected the
FisherPrice is developing an aggregate plan for a popular line of power wheels kids rideon toys. The company has collected the following key inputs for its aggregate planning process in Table
Table
Parameter Value
Previous Month's Production Month in units
Starting inventory in units
Production Cost per unit $
Hiring Cost per unit $
Layoff Cost per unit $
Cost of holding inventory per unit per month $
Cost of a backorder per unit per month $
The company forecasts the demand for the months of the planning horizon and provides the forecasts in Table
Table
Month Demand
Calculate the total cost over the planning horizon for a level strategy that uses inventory but no backorders.
How should you set the production level to minimize the cost of this plan?
Round up the nearest whole unit when deriving the production value to use in each period.
Carry all calculations to decimal places.
Enter your final answer rounded to the nearest dollar.
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