Scenario 8.1-Gang Aft Agley Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2. $\begin{array}{|l|c|c|c|c|c|} \hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \\ \hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \\ \hline \text { Beginning Inventory } & 100 & & & & \\ \hline \text { Regular Time } & & & & & \\ \hline \text { Overtime } & & & & & \\ \hline \text { Subcontracting } & & & & & \\ \hline \text { Ending Inventory } & & & & & \\ \hline \end{array}$ The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts. -Which of these statements about Scenario 8.1 is evident without even developing an aggregate plan?

A) Some overtime will be needed. B) Ending inventory must be negative. C) Overtime must exceed subcontracting. D) Subcontracting must exceed regular time output. A) Some overtime will be needed. B) Ending inventory must be negative. C) Overtime must exceed subcontracting. D) Subcontracting must exceed regular time output.

Scenario 8.1 - Gang Aft Agley Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2. $\begin{array}{|l|c|c|c|c|c|} \hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \\ \hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \\ \hline \text { Beginning Inventory } & 100 & & & & \\ \hline \text { Regular Time } & & & & & \\ \hline \text { Overtime } & & & & & \\ \hline \text { Subcontracting } & & & & & \\ \hline \text { Ending Inventory } & & & & & \\ \hline \end{array}$ The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts. -Formulate the aggregate plan using linear programming and solve it using Solver.

Using the variables @#LAT-DLM& regular production;

Scenario 8.1-Gang Aft Agley Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2. $\begin{array}{|l|c|c|c|c|c|} \hline & \text { January } & \text { February } & \text { March } & \text { April } & \text { May } \\ \hline \text { Forecast } & 500 & 750 & 1200 & 650 & 300 \\ \hline \text { Beginning Inventory } & 100 & & & & \\ \hline \text { Regular Time } & & & & & \\ \hline \text { Overtime } & & & & & \\ \hline \text { Subcontracting } & & & & & \\ \hline \text { Ending Inventory } & & & & & \\ \hline \end{array}$ The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts. -Use the information from Scenario 8.1 to determine the objective function for this scenario.

A) $\text { Max Output } = \sum \text { Regular } + \sum \text { Overtime } + \sum \text { Subcontracting }$ B) Max Profit $= \sum$ Revenue $- \$ 5 \sum$ Regular $- \$ 7.5 \sum$ Overtime $- \$ 9 \sum$ Subcontracting $\$ 2 \sum$ Ending Inventory C) $\text { Min Cost } = \$ 5 \sum \text { Regular } + \$ 7.5 \sum \text { Overtime } + \$ 9 \sum \text { Subcontracting } + \$ 2 \sum \text { Ending Inventory }$ D) $\text { Min Output } = \sum \text { Overtime } + \sum \text { Subcontracting }$ A) $\text { Max Output } = \sum \text { Regular } + \sum \text { Overtime } + \sum \text { Subcontracting }$ B) Max Profit $= \sum$ Revenue $- \$ 5 \sum$ Regular $- \$ 7.5 \sum$ Overtime $- \$ 9 \sum$ Subcontracting $\$ 2 \sum$ Ending Inventory C) $\text { Min Cost } = \$ 5 \sum \text { Regular } + \$ 7.5 \sum \text { Overtime } + \$ 9 \sum \text { Subcontracting } + \$ 2 \sum \text { Ending Inventory }$ D) $\text { Min Output } = \sum \text { Overtime } + \sum \text { Subcontracting }$

Exam 8: Aggregate Planning in a Supply Chain

Demand is forecast for the next five months as 200, 300, 500, 300, 200. The production planner decides to adopt a level strategy, so over the next five months they should produce

(Multiple Choice)

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Question 41

Which of the following is an approach a company can use to create a buffer for forecast error using safety inventory?

(Multiple Choice)

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Question 42

Scenario 8.1-Gang Aft Agley Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2. January February March April May Forecast 500 750 1200 650 300 Beginning Inventory 100 Regular Time Overtime Subcontracting Ending Inventory The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts. -Which of these statements about Scenario 8.1 is evident without even developing an aggregate plan?

(Multiple Choice)

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Question 43

The goal of aggregate planning is to build a plan that satisfies demand while minimizing downtime.

(True/False)

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Question 44

The quality of the aggregate plan can be improved by using information from

(Multiple Choice)

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Question 45

Forecasting errors are dealt with using

(Multiple Choice)

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Question 46

The strategy where the production rate is synchronized with the demand rate by varying machine capacity or hiring and laying off employees as the demand rate varies is the

(Multiple Choice)

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Question 47

Scenario 8.1 - Gang Aft Agley Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2. January February March April May Forecast 500 750 1200 650 300 Beginning Inventory 100 Regular Time Overtime Subcontracting Ending Inventory The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts. -Formulate the aggregate plan using linear programming and solve it using Solver.

(Essay)

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Question 48

Discuss key issues to be considered when implementing aggregate planning.

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Question 49

The aggregate planner must make a trade-off between capacity, inventory, and backlog costs.

(True/False)

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Question 50

Inventory held to satisfy demand that is higher than forecasted is

(Multiple Choice)

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Question 51

Scenario 8.1-Gang Aft Agley Gang Aft Agley, a manufacturing company, faces the aggregate planning problem shown in the table below. Cost of regular production is $5 per unit, the cost of producing the same unit on overtime is $7.50, the cost of subcontracting is $9 per unit, and the cost of carrying a unit in inventory from one month to the next is $2. January February March April May Forecast 500 750 1200 650 300 Beginning Inventory 100 Regular Time Overtime Subcontracting Ending Inventory The labor contract at the plant prohibits both overtime and subcontracting output to exceed 300 units in any five month window. The plant capacity is 600 units per month produced using two shifts, regardless of the number of days in a month. By policy, management wants to avoid stockouts. -Use the information from Scenario 8.1 to determine the objective function for this scenario.

(Multiple Choice)

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Question 52

Aggregate planning solves problems involving

(Multiple Choice)

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Question 53

As inputs into the aggregate plan change, managers do not need to make changes to the aggregate plan.

(True/False)

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Question 54

Discuss the information required for aggregate planning.

(Essay)

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Question 55

To improve the quality of aggregate plans, forecast errors must be taken into account when formulating aggregate plans.

(True/False)

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Question 56

An aggregate planner requires information on constraints. Which of the following is one of the typical constraints for an aggregate planner?

(Multiple Choice)

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Question 57

Short-term production serves as a broad blueprint for operations and establishes the parameters within which aggregate planning decisions are made.

(True/False)

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Question 58

When formulating aggregate plans,

(Multiple Choice)

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Question 59

What information does a master production schedule provide that an aggregate plan does not?

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Question 60

Demand is forecast for the next five months as 200, 300, 500, 300, 200. The production planner decides to adopt a level strategy, so over the next five months they should produce

Which of the following is an approach a company can use to create a buffer for forecast error using safety inventory?

The goal of aggregate planning is to build a plan that satisfies demand while minimizing downtime.

The quality of the aggregate plan can be improved by using information from

Forecasting errors are dealt with using

The strategy where the production rate is synchronized with the demand rate by varying machine capacity or hiring and laying off employees as the demand rate varies is the

Discuss key issues to be considered when implementing aggregate planning.

The aggregate planner must make a trade-off between capacity, inventory, and backlog costs.

Inventory held to satisfy demand that is higher than forecasted is

Aggregate planning solves problems involving

As inputs into the aggregate plan change, managers do not need to make changes to the aggregate plan.

Discuss the information required for aggregate planning.

To improve the quality of aggregate plans, forecast errors must be taken into account when formulating aggregate plans.

An aggregate planner requires information on constraints. Which of the following is one of the typical constraints for an aggregate planner?

Short-term production serves as a broad blueprint for operations and establishes the parameters within which aggregate planning decisions are made.

When formulating aggregate plans,

What information does a master production schedule provide that an aggregate plan does not?

Understanding the Supply Chain

Supply Chain Performance: Achieving Strategic Fit and Scope

Supply Chain Drivers and Metrics

Designing Distribution Networks and Applications to e-Business

Network Design in the Supply Chain

Designing Global Supply Chain Networks

Demand Forecasting in a Supply Chain

Sales and Operations Planning: Planning Supply and Demand in a Supply Chain

Coordination in a Supply Chain

Managing Economies of Scale in the Supply Chain: Cycle Inventory

Managing Uncertainty in a Supply Chain: Safety Inventory

Determining the Optimal Level of Product Availability

Transportation in a Supply Chain

Sourcing Decisions in a Supply Chain

Pricing and Revenue Management in a Supply Chain

Sustainability and the Supply Chain

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