Develop an aggregate production plan

Solve the below problem:

Q: A planner has developed an aggregate forecast for demand for the next 6 months as shown below: Month January February March April May June Forecast 6000 5000 6000 5500 6000 7000 Use the following information to develop aggregate plans: Regular production cost: $10.00 per case Regular production capacity: 5500 cases/month Overtime production cost: $15.00 per case Subcontracting cost: $20.00 per case Holding/Carrying cost: $2.00 per case per month Develop an aggregate production plan for each of the following guidelines and compute the total cost for each plan. Note: backlogs are not allowed.

1. Use level-capacity production and supplement with inventory and subcontracting as needed.

2. Use a combination of inventory, regular production, overtime (maximum 200 cases per month), and subcontracting (maximum 300 cases per month) as needed.

3. Use regular production, inventory and overtime (500 cases maximum per month).

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Operation Management: Develop an aggregate production plan
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