Month Demand Forecast Month Demand Forecast January 133,067 July 251,630 February 155,026 August 249,630 March 168,200 September 200,312 April 173,890 October 160,830 May 202,759 November 145,266 June 260,842 December 128,900 Regular production cost per unit Holding cost per unit per month based on ending inventory Backorder cost $18.00 per unit per month based on ending inventory Beginning Inventory 340,000 units Beginning workforce 7 employees Regular production rate 15,000 units per employee per month Hiring cost ,000 per worker Firing cost $8,000 per worker For the next 4 questions follow the chase production strategy. Absorb variations in demand by changing the size of the workforce. When additional employees are hired or fired, they cannot be fractions of a person. You must round up to the next whole person. When you round up, all those employees work the full month which could result in some inventory that is carried to the next period. Ending inventory should be as low as possible each month. 22. How many units are produced for the year using the chase production strategy? A. Less than 1,800,000 B. Between 1,800,000 and 2,000,000 C. Between 2,000,001 and 2,200,000 D. More than 2,200,000 23. What is the annual total cost of firing employees in this example following the chase production strategy? A. Between $50,000 and $100,000 B. Between $100,001 and $150,000 C. Between $150,001 and $200,000 D. Greater than $200,001 24. What are the total costs incurred following the chase production strategy? A. Less than $73,000,000 B. Between $73,000,001 and $75,000,000 C. Between $75,000,001 and $77,000,000 D. Greater than $77,000,001 25. How many workers are required in July following the chase production strategy? A. 15 B. 16 C. 17 D. 18
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