MECHANICAL ENGINEERING

GATE - 2023 CRASH COURSE

Industrial Engg. &
O pe ra ti on Re s ea r ch

a te Pro d.
Aggreg
n g (M R P )
Planni

LECTURE 18 AMIT DIXIT

 Forecasting Error

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Material Resourse Planning

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Components of MRP:
1. Master Production Schedule

2. Bill of Material

3. In-hand Inventory
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Master Production Schedule:

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Bill of Material:

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In-hand Inventory:

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1. Demand of a Product P is given as below:
Week 1 2 3 4 5 6
Demand P 1000 1000 1000 1000 1200 1200

A bottleneck operation is mentioned as production

of R. Find minimum production rate of R to meet
the demand. No initial inventory is available.
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 Week 1 2 3 4 5 6
Demand P 1000 1000 1000 1000 1200 1200
Demand R

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 Week 1 2 3 4 5 6
Demand P 1000 1000 800 1000 1200 1200
Demand R

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 Week 1 2 3 4 5 6
Demand P 1000 800 500 1000 700 1200
Demand R

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 Week 1 2 3 4 5 6
Demand P 500 1000 1200 1000 1400 600
Demand R

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2. Demand of a Product P is given as below:
Week 6 7 8
Demand P 30 50 70

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3. Data for a production process is given as under:
Holding Cost – Rs. 2 per unit per month
Regular Prod. Cost – Rs. 20 per unit
Overtime Prod. Cost – Rs. 24 per unit
Month Regular Prod. Overtime Prod. Demand
Capacity Capacity
1 100 C
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20 90
2 100 20 130
3 80 40 110
For minimum cost plan, planned production in overtime in
the third month
4. Data for a production process is given as under:
Holding Cost – Rs. 4 per unit per month
Regular Prod. Cost – Rs. 20 per unit
Overtime Prod. Cost – Rs. 25 per unit
Month Regular Prod. Overtime Prod. Demand
Capacity Capacity
1 100 C
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2 110 20 130
3 90 40 110
For minimum cost plan, planned production in overtime in
the third month
5. A manufacturer has following data regarding a
product:
Fixed cost per month = Rs. 50,000
Variable Cost per unit = Rs. 200
Selling price per unit = Rs. 300
Production capacity = 1500 units per month
If the production is carried out at 80% of the rated
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capacity, then the monthly profit is

 Manufacturing Resource Planning
Manufacturing Resource Planning (MRP II) is an integrated
information system used by businesses. Manufacturing Resource
Planning (MRP II) evolved from early Materials Requirement
Planning (MRP) systems by including the integration of additional
data, such as employee and financial needs.
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The system is designed to centralize, integrate, and process

information for effective decision making in scheduling, design
engineering, inventory management, and cost control in
manufacturing.
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