Question 2 (30 Points) Continued from Question 2

The capacity information of Product X is listed below.

Regular Capacity 100 unit per month

Regular Cost - $1,250 per unit.

OT Capacity 20 unit per month

OT Cost - $1,400 per unit

Subcontract Capacity 30 unit per month

Subcontract Cost - $1650 per unit

Holding Cost - $180 per unit per month

Backlog NOT allowed.

With the above information, establish the Aggregate plan for the following three options.

1. Option 1, use regular, OT and subcontract to satisfy all the demand.
2. Option 2, use regular, OT and inventory to satisfy all the demand.

Option 3, use regular, OT, subcontractor and inventory to satisfy all the demand

Unmesh Kanswered this 1,773 answers a) Total demand = 670 =100+110+120+140+100+100 = 670 b) Total defectives = 33.5 =(5%*100)+(59*110)+(5%*120)=(5%*140)+(5%*100)+(5%*100) = 33.5 c) New values are as follows: July: 100+(5%*100) = 105 August: 110+(596*110) = 115.5 September: 120+(5%*120) = 126 October: 140+(59*140) = 147 November: 100+(5%*100) = 105 December: 100+(5%*100) = 105