Question: please explain your answer, thank you. Chase strategy adjusts capacity to match the demand pattern. The firm will hire and lay off workers to match


please explain your answer, thank you.
Chase strategy adjusts capacity to match the demand pattern. The firm will hire and lay off workers to match its production rate to demand. The workload fluctuates from month to month, but finished goods inventory remains constant. (The workforce is chasing demand.) The constant level of finished goods will either be the safety stock amount, or zero if no safety stock is held. This is because we only want to hire enough workers to satisfy demand. (We don't want to pay for extra labor to build up overstock (i.e. extra inventory)). This strategy works well for make-to-order since cannot rely on finished good inventory to satisfy the fluctuating demand pattern. We calculate the number of workers by taking the forecast demandumber of units produced per worker. Question 1 2 pts Given the following production plan, use a chase strategy to compute ending inventory levels. Jan 2,000 Feb 3,000 Mar 5,000 Apr 6,000 May 6,000 June 2,000 Demand The ending inventory level for the month of Feb isStep by Step Solution
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