Question: Please answer the following question using the info below: What does Cost as calculated above tell you as the manager for this operation as it
Please answer the following question using the info below:
- What does Cost as calculated above tell you as the manager for this operation as it relates to the:
- Chase Demand
- Level of Production
CARE Alliance (CA) a manufacturer of emergency care kits for disaster relief has received the annual disaster readiness plans from its major constituents and now must develop an operations plan to set production, Labor and inventory levels of its basic emergency products for the next 4 quarters. Demand for the kits, given below varies with seasonal weather, political climate and economic conditions
| Quarter | Demand |
| 1 | 150,000 |
| 2 | 250,000 |
| 3 | 350,000 |
| 4 | 250,000 |
The average worker at CA can produce 10,000 Kits a quarter at a cost of 9& per kit. The cost of holding inventory is $2 per kit per quarter. Due to the medical nature of many of its products and concern for quality hiring and firing costs are $700 per worker. CA currently employs 20 workers. Given the demand forecast below complete the charts below by filling in the squares with a ?.
| a) Chase Demand | COST = | ? | ||||
| Quarter | Demand | Production | Inventory | # Workers | # Hired | # Fired |
| 1 | 150,000 | 150,000 | 0 | 15 | 0 | ? |
| 2 | 250,000 | 250,000 | ? | ? | ? | 0 |
| 3 | 350,000 | 350,000 | ? | ? | ? | 0 |
| 4 | 250,000 | 250,000 | 0 | 25 | 0 | ? |
| 1,000,000 | 1,000,000 | ? | ? | ? | ||
| b) Level Production | COST = | ? | ||||
| Quarter | Demand | Production | Inventory | # Workers | # Hired | # Fired |
| 1 | 150,000 | 250,000 | 100,000 | 25 | 5 | 0 |
| 2 | 250,000 | 250,000 | ? | ? | 0 | 0 |
| 3 | 350,000 | 250,000 | 0 | ? | ? | 0 |
| 4 | 250,000 | 250,000 | 0 | 25 | 0 | ? |
| 1,000,000 | 1,000,000 | ? | ? | ? | ||
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