QUESTION TWO

$[20]$

Since it is usually impossible to consider every fine detail associated with the production process while maintaining such a long planning horizon, it is mandatory to aggregate the information being processed. The aggregate production approach is predicated on the existence of an aggregate unit of production, such as the "average" item, or in terms of weight, volume, production time, or dollar value. Plans are then based on aggregate demand for one or more aggregate items. Once the aggregate production plan is generated, constraints are imposed on the detailed production scheduling process which decides the specific quantities to be produced of each individual item. The plan must consider various ways a firm can cope with demand fluctuations as well as the cost associated with them. With this regard,

$2\mathrm{.}1$ Discuss the applicable demand alternatives that operations managers can use to control aggregate plans.

End of assignment questions