Reference no: EM131556212
Question: In a company, the monthly forecasts for Product X for January, February, and March 2018 are 1,000, 1,500, and 1,200, respectively. Safety stock policy recommends that a quarter of the forecast for that month be defined as safety stock. There are 22 working days on January 18 in February, and 21 in March. Beginning inventory is 300 units.
Manufacturing cost is $150 per unit, storage cost is $5 per unit per month, standard pay rate is $10 per hour, overtime rate is $15 per hour, cost of stock out is $10 per unit per month, marginal cost of subcontracting is $12 per unit, hiring and training cost is $400 per worker, layoff cost is $600 per worker, and worker productivity is 0.5 unit per hour. Assume that you start off with 40 workers and that they work 8 hours per day.
Develop a production schedule to produce the exact production requirements by varying the workforce size for the following problem.
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