SUBJECT: PRODUCTION MANAGEMENT

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The following data refers to an aggregate planning problem. The Company wants to use only regular time production at a uniform rate throughout the year to meet the demand. The cost of production is Rs.100/unit. Shortage are not permitted. The inventory carrying cost is Rs.6/unit/quarter. Determine the starting inventory required for this plan. Calculate the total annual cost of the aggregate plan. The aggregate demand and working days are as shown below: Period (Quarter.) I II III IV Aggregate Demand [units] 960 600 900 1140 Working days 60 55 60 65