Exam 13: Sales and Operations Planning

You are sitting next to a person in business class on a flight from Los Angeles to Sydney, Australia. You mention to that person that you got your ticket two months ago for only $12,500. The person responds that she bought her ticket two days ago for $7,800. This sometimes happens because airlines often use an approach called:

Jones Corporation is preparing an aggregate production plan for washers for the next four quarters. The company's expected quarterly demand is given in the following chart. The company will have 1,000 washers in inventory at the beginning of the year and wishes to maintain at least that number at the end of each quarter. Following is other critical data: Production cost per unit = $250 Inventory carrying cost per quarter per unit = $10 (based on quarter-ending inventory) Hiring cost per worker = $1,000 Firing cost per worker = $2,000 Beginning number of workers = 10 Each worker can produce 100 units per quarter.Any worker on the staff at the end of the year will not be fired at that time. Given this data, what is the inventory carrying cost of a LEVEL plan?

Wiedmer Corporation is preparing an aggregate production plan for widgets for the next four months. The company's expected monthly demand is given in the following chart. The company will have 50 widgets in inventory at the beginning of the first month and wishes to maintain at least that number at the end of each month.Following is other critical data: Production cost per unit = $50 Inventory carrying cost per month per unit = $10 (based on ending month inventory) Hiring cost per worker = $300 Firing cost per worker = $200 Beginning number of workers = 16 Each worker can produce = 50 units per month.LEVEL PLAN What is the total inventory carrying cost for the level plan?

Which of the following is NOT one of the costs considered in aggregate production planning?

Wiedmer Corporation is preparing an aggregate production plan for widgets for the next four months. The company's expected monthly demand is given in the following chart. The company will have 50 widgets in inventory at the beginning of the first month and wishes to maintain at least that number at the end of each month.Following is other critical data: Production cost per unit = $50 Inventory carrying cost per month per unit = $10 (based on ending month inventory) Hiring cost per worker = $300 Firing cost per worker = $200 Beginning number of workers = 16 Each worker can produce = 50 units per month.LEVEL PLAN What is the total cost of a chase plan which uses only hiring/firing?

Generally speaking, the sales function and operations function differ in objectives. Which of the following is NOT one of those differences?

Which type of aggregate production plan is likely to have the LEAST negative impact on the local community and the workforce?

The focus of an aggregate production plan, in general, is on all of the following EXCEPT:

Zanda Corp. and Jones Corp. are identical in every way (products produced, costs, demand, etc.) except for one. Zanda uses a level production plan while Jones prefers a chase production plan. Which of the following is most likely to be true?

John Jones, senior VP for Zanda Corp., is looking at three alternative aggregate production plans for the next six-month period. At his company, demand varies by month with substantial month-to-month differences. The three alternatives are a "pure level plan," which keeps an absolutely constant workforce, a "pure chase plan" relying on hiring and layoffs, and a hybrid plan. He is most likely to find that the pure level plan:

Dave's Stove-Top Popcorn currently has three full-time employees who are each paid $1,500 per month. An employee can only work a maximum of 100 hours per month because production normally takes place at night. They do receive $1,500 even if they do not work 100 hours, however. Part-time employees can be hired at a cost of $25 per hour. Dave's Stove-Top Popcorn has forecasted that demand for the next six months will be as follows: What is the total cost if Dave hires one more full-time employee to meet additional demand?

Decisions being made about the aggregate production plans represent what type of planning?

Wiedmer Corporation is preparing an aggregate production plan for widgets for the next four months. The company's expected monthly demand is given in the following chart. The company will have 50 widgets in inventory at the beginning of the first month and wishes to maintain at least that number at the end of each month.Following is other critical data: Production cost per unit = $50 Inventory carrying cost per month per unit = $10 (based on ending month inventory) Hiring cost per worker = $300 Firing cost per worker = $200 Beginning number of workers = 16 Each worker can produce = 50 units per month.LEVEL PLAN What is the total cost of the level plan?

Wiedmer Corporation is preparing an aggregate production plan for widgets for the next four months. The company's expected monthly demand is given in the following chart. The company will have 50 widgets in inventory at the beginning of the first month and wishes to maintain at least that number at the end of each month.Following is other critical data: Production cost per unit = $50 Inventory carrying cost per month per unit = $10 (based on ending month inventory) Hiring cost per worker = $300 Firing cost per worker = $200 Beginning number of workers = 16 Each worker can produce = 50 units per month.LEVEL PLAN What is the regular monthly actual production for a level plan?

If a make-to-stock manufacturing firm with highly seasonal demand follows a level production strategy, which of the following is likely to be true?

Dave's Stove-Top Popcorn currently has three full-time employees who are each paid $1,500 per month. An employee can only work a maximum of 100 hours per month because production normally takes place at night. They do receive $1,500 even if they do not work 100 hours, however. Part-time employees can be hired at a cost of $25 per hour. Dave's Stove-Top Popcorn has forecasted that demand for the next six months will be as follows: What is the total cost if Dave relies on part-time employees to meet additional demand?

Wiedmer Corporation is preparing an aggregate production plan for widgets for the next four months. The company's expected monthly demand is given in the following chart. The company will have 50 widgets in inventory at the beginning of the first month and wishes to maintain at least that number at the end of each month.Following is other critical data: Production cost per unit = $50 Inventory carrying cost per month per unit = $10 (based on ending month inventory) Hiring cost per worker = $300 Firing cost per worker = $200 Beginning number of workers = 16 Each worker can produce = 50 units per month.LEVEL PLAN What is the inventory carrying cost of a chase plan accomplished through hiring and firing?

Zanda Corp. and Jones Corp. are identical in every way (products produced, costs, demand, etc.) except for one. Zanda uses a level production plan while Jones prefers a chase production plan. Which of the following is most likely to be true?

Which of the following is true concerning sales and operations planning?

John Jones, senior VP for Zanda Corp., is looking at three alternative aggregate production plans for the next six-month period. At his company, demand varies by month with substantial month-to-month differences. The three alternatives are a "pure level plan," which keeps an absolutely constant workforce, a "pure chase plan" relying on hiring and layoffs, and a hybrid plan. He is most likely to find that the hybrid plan: