Aggregate production plan for product

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Reference no: EM133983320

Question

Right now is July 1, 2021. You would like to construct an aggregate production plan for product P1X34 for the next four quarters of 2021.

Cost of regular production = 65 $/u
Cost of overtime production = 97 $/u
Inventory holding cost = 5 $/u/qtr
Cost of increasing regular production = 33 $/u
Cost of decreasing regular production = 48 $/u
The regular production in Quarter 4 of 2020 = 813 u
The inventory at the beginning of Quarter 1 of 2021 is estimated to be 66 u
The forecasted demand for the four quarters of 2021 are: 705, 717, 936, and 733 units.

You want to use the chase production strategy without overtime production and keep inventory as low as possible. Shortages are not allowed.

You must perform the calculation and answer the questions shown below.

NOTE: Do not use any comma in your answers.

The total cost of increasing regular production is _____________ dollars.

Reference no: EM133983320

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