Link's Lumber manufactures pressure-treated wood materials that it aggregates into metric tons of output for medium-term capacity planning. Link's follows level production schedules calculated at 6-month intervals, determining the level production rate that minimizes inventory while meeting all demand over those 6 months. Link's latest aggregate plan is nearly over, so it begins the next planning cycle with this forecast for the next 6 months: Month Month Month Month Month Month 2 3 Demand 1,000 1,000 5,000 20,000 7,000 3,000 (metric tons) Link's Lumber will begin month 1 with nothing in inventory and will pro- duce the same amount in each of the 6 months of the planning period. Questions 1. Prepare a chart similar to Figure 11.4, showing both cumulative demand and cumu- lative production for Link's Lumber over the next 6 months. Indicate the natural planning horizon on this chart. 2. What is the minimum constant production (MCP) rate that Link's Lumber should use during each of these next 6 months? 3. When is the accumulated inventory of metric tons of output highest during this 6-month plan, and what does it peak at?
Link's Lumber manufactures pressure-treated wood materials that it aggregates into metric tons of output for medium-term capacity planning. Link's follows level production schedules calculated at 6-month intervals, determining the level production rate that minimizes inventory while meeting all demand over those 6 months. Link's latest aggregate plan is nearly over, so it begins the next planning cycle with this forecast for the next 6 months: Month Month Month Month Month Month 2 3 Demand 1,000 1,000 5,000 20,000 7,000 3,000 (metric tons) Link's Lumber will begin month 1 with nothing in inventory and will pro- duce the same amount in each of the 6 months of the planning period. Questions 1. Prepare a chart similar to Figure 11.4, showing both cumulative demand and cumu- lative production for Link's Lumber over the next 6 months. Indicate the natural planning horizon on this chart. 2. What is the minimum constant production (MCP) rate that Link's Lumber should use during each of these next 6 months? 3. When is the accumulated inventory of metric tons of output highest during this 6-month plan, and what does it peak at?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Transcribed Image Text:Link's Lumber manufactures pressure-treated wood materials that it aggregates
into metric tons of output for medium-term capacity planning. Link's follows
level production schedules calculated at 6-month intervals, determining the
level production rate that minimizes inventory while meeting all demand over
those 6 months. Link's latest aggregate plan is nearly over, so it begins the next
planning cycle with this forecast for the next 6 months:
Month
Month
Month
Month
Month
Month
2
3
Demand
1,000
1,000
5,000
20,000
7,000
3,000
(metric tons)
Link's Lumber will begin month 1 with nothing in inventory and will pro-
duce the same amount in each of the 6 months of the planning period.
Transcribed Image Text:Questions
1. Prepare a chart similar to Figure 11.4, showing both cumulative demand and cumu-
lative production for Link's Lumber over the next 6 months. Indicate the natural
planning horizon on this chart.
2. What is the minimum constant production (MCP) rate that Link's Lumber should
use during each of these next 6 months?
3. When is the accumulated inventory of metric tons of output highest during this
6-month plan, and what does it peak at?
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