Essay
An electronics manufacturer makes video security systems for parking lots. Demand estimates for the next four quarters are 15, 9, 23, and 17 units. Prepare an aggregate plan that uses inventory, regular time, overtime, and back orders. Subcontracting is not allowed. Regular time capacity is 12 units for quarters 1 and 2, 15 units for quarters 3 and 4. Overtime capacity is 6 units per quarter. Regular time cost is $20,000 per system, while overtime cost is $30,000 per unit. Back order cost is $2000 per system per quarter; inventory holding cost is $500 per unit per quarter. Beginning inventory is zero.
Complete the table of data inputs for solving this aggregate planning problem with the transportation method. Specifically, how many sources are there, and how many destinations?
What is the supply from each source, and the demand of each destination?
What is the cost of each source-destination pair?
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