Consuelo Chua, Inc., is a Columbian disk drive manufacturer in need of an aggregate plan for July through December. The company has gathered the following data given in the tables. There are 8 hours of production per day. You manage a consulting firm down the street from Consuelo Chua, Inc., and to get your foot in the door, you have told Ms. Chua that you can do a better job at aggregate planning than her current staff. She said, "Fine. You do that, and you have a 1-year contract." To make good on your boast, you propose a new strategy. Hire 5 workers in August and 5 more in October, and subcontract to meet the rest of the demand. What will be the cost of this strategy? Costs Holding cost Subcontracting Regular-time labor Overtime labor Hiring cost Layoff cost Other data Current workforce (June) Labor-hours/disk drive Workdays/month Beginning Inventory Ending Inventory O disk drives *Note that there is no holding cost for June. Fill in the table below. (Enter all responses as whole numbers. In the hire/fire column, use positive numbers for hires -- plus signs omitted; negative numbers for layoffs.) Month 0 June 1 July 2 August 3 September 4 October 5 November 6 December $8/disk drive/Month $80/disk drive $12 $18/hour (above 8 hours) $45/worker $80/worker Demand 350 480 450 700 750 720 Beginning Inventory 150 8 people 4 hours 20 days 150 disk drives* Units Personnel on Hire / Produced Staff Layoff 8 1☐☐☐UL Ending Inventory
Consuelo Chua, Inc., is a Columbian disk drive manufacturer in need of an aggregate plan for July through December. The company has gathered the following data given in the tables. There are 8 hours of production per day. You manage a consulting firm down the street from Consuelo Chua, Inc., and to get your foot in the door, you have told Ms. Chua that you can do a better job at aggregate planning than her current staff. She said, "Fine. You do that, and you have a 1-year contract." To make good on your boast, you propose a new strategy. Hire 5 workers in August and 5 more in October, and subcontract to meet the rest of the demand. What will be the cost of this strategy? Costs Holding cost Subcontracting Regular-time labor Overtime labor Hiring cost Layoff cost Other data Current workforce (June) Labor-hours/disk drive Workdays/month Beginning Inventory Ending Inventory O disk drives *Note that there is no holding cost for June. Fill in the table below. (Enter all responses as whole numbers. In the hire/fire column, use positive numbers for hires -- plus signs omitted; negative numbers for layoffs.) Month 0 June 1 July 2 August 3 September 4 October 5 November 6 December $8/disk drive/Month $80/disk drive $12 $18/hour (above 8 hours) $45/worker $80/worker Demand 350 480 450 700 750 720 Beginning Inventory 150 8 people 4 hours 20 days 150 disk drives* Units Personnel on Hire / Produced Staff Layoff 8 1☐☐☐UL Ending Inventory
Chapter19: Pricing Concepts
Section: Chapter Questions
Problem 6DRQ
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Transcribed Image Text:Consuelo Chua, Inc., is a Columbian disk drive manufacturer in need of an aggregate plan for July through December. The company has gathered the following data given in the tables. There are 8
hours of production per day.
You manage a consulting firm down the street from Consuelo Chua, Inc., and to get your foot in the door, you have told Ms. Chua that you can do a better job at aggregate planning than her current
staff. She said, "Fine. You do that, and you have a 1-year contract." To make good on your boast, you propose a new strategy. Hire 5 workers in August and 5 more in October, and subcontract to
meet the rest of the demand. What will be the cost of this strategy?
Other data
Current workforce (June)
Labor-hours/disk drive
Workdays/month
Beginning Inventory
Ending Inventory
*Note that there is no holding cost for June.
8 people
4 hours
20 days
150 disk drives*
O disk drives
Fill in the table below. (Enter all responses as whole numbers. In the hire/fire column, use positive numbers for hires -- plus signs omitted; negative numbers for layoffs.)
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Costs
Holding cost
Subcontracting
Regular-time labor
Overtime labor
Hiring cost
Layoff cost
Month
0 June
1 July
2 August
3 September
4 October
5 November
6 December
$8/disk drive/Month
$80/disk drive
$12
$18/hour (above 8 hours)
$45/worker
$80/worker
Demand
350
480
450
700
750
720
Beginning
Inventory
150
Units
Produced
Personnel on Hire /
Staff Layoff
8
Ending
Inventory
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