The capacity for regular time production is 200 units per month. Overtime capacity is 100 per...

The capacity for regular time production is 200 units per month. Overtime capacity is 100 per month. Subcontracting is also available. The demand forecast is 100, 400, and 300, for month 1, month 2, and month 3, respectively. The per-unit cost for regular time production, overtime production, and subcontracting is $1, $2, and $3, respectively. Inventory cost is $1 per unit per period (on average inventory). The beginning inventory for the first period is zero. Develop a chase strategy (under the goal of minimizing the total cost) and answer the following questions.

Based on the chase strategy, what is the amount that should be produced using regular time production in month 1?

Based on the chase strategy, what is the amount that should be produced using subcontracting in month 2?

Expert Solution

Below is the screenshot of the formula applied -

Below is the screenshot of the result of chase schedule -

From above -

Based on the chase strategy, what is the amount that should be produced using regular time production in month 1 - 100 units

Based on the chase strategy, what is the amount that should be produced using subcontracting in month 2 - 100 units

keosha answered 1 month ago

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