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Homework Chapter 14 (Aggregate Planning)

DAT, Inc. needs to develop an aggregate plan for its product line. Relevant data are
Production time:
Average labor cost:
Workweek:
Days per month:
Hiring cost:
Layoff cost:
Beginning inventory:
Safety stock:
Shortage cost:
Inventory cost:
Outsourced cost:

1 hour per unit


$10/hour
5 days, 8 hours per day
Assume 20 days per month
$300/worker
$400/worker
200 units
None
$20 per unit per month
$5 per unit per month
$12/unit

DAT Inc. currently employs 18 workers. The forecast for the next 6 months is:
Jan.
2400

Feb.
3000

Mar.
4000

Apr.
3500

May
3500

June
3000

Should the company use a chase strategy, a level strategy or a stable strategy with
outsourcing?

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