Assignment:
Please answer each step of the question
The Sohn Aerospace Division of Sohnco has a demand forecast for the first three months of next year is:
January 600 ships
February 100 ships
March 900 ships
Strangely, they have 100 ships in stock as of December 31.
a) Plot cumulative demand and a level aggregate production plan with no back orders and no ending inventory.
b) What production is needed each month to meet part a's conditions?
c) Suppose any left-over ships at the end of each month cost $500,000 per month in storage and interest costs. Assume the start-up inventory is not part of the calculation. Should we make any changes to our plan? Explain your answer.