- Requirements: 1. No shortage allowed. 2. Use the level strategy. 3. Decision variable: # of Workers 4. No hire or layoff during the planning period. Beginning Conditions: BI= Beg #Wkrs Output Rate O units 270 workers 50 units/wkr 1 Aggregate Production Plan 2 Month Jan Feb Mar April May June Total 3 Shipment Forecast 9,000 17,000 18,000 16,000 10,000 8,000 4 Aggregate Production Plan 15,000 15,000 15,000 15,000 15,000 15,000 5 Output Plan 5 Shipments 9,000 17,000 18,000 16,000 10,000 8,000 7 Ending Inventory (BI=0) 6,000 4,000 1,000 0 5,000 12,000 28,000 3 Input Plan 9 # of Workers (BW=270) 300 300 300 300 300 300 1,800 Hires 30 0 0 0 0 0 30 1 Layoffs 0 0 0 0 0 2 3 Costs: Total Cost 2 Unit Cost Units Subtotal 5 Straight Time Cost 800 /wkr/mo 1,800 1,440,000 5 Inventory Holding 1 /unit/mo 28,000 28,000 Hiring Cost 1,000 /wkr 30 30,000 8 Layoff Cost 500 /kr 0 0 0 O Total Cost 1,498,000 1 2 Intermediate Calculation: Determining the minimum #of workers required: 3 Month 1 2 3 5 4 Cumulative Demand 9,000 26,000 44,000 60,000 70,000 5 Avg Demand/Month 9,000 13,000 14,667 15,000 14,000 5 7 Highest Avg: 15,000 3 #Wkrs Req.: 300 (use this to develop the Aggregate Production Plan) 6 78,000 13,000 DESCRIPTION/FORMULA given = Hof workers * output rate/worker/month ITEM Shipment Forecast Aggregate Production Plan Output Plan Shipments Ending Inventory (Bl=0) Input Plan # of Workers (BI=270) Hires Layoffs =smaller of (total quantity available, demand forecast), where total quantity available = El of previous month + APP quan = total quantity available-shipment a decision variable = # of workers of current month - #of workers of previous month, if # of workers increases =# of workers of previous month - # of workers of current month, if # of workers decreases