Table D.4
Bahouth Enterprises produces a variety of hookahs for clients around the globe.Their small plant has a highly flexible workforce that can switch between products seamlessly.They forecast using a six-month planning period and have a demand forecast as shown in the table.The per-unit costs for each output option the sales and operations planner has at his disposal are indicated in the table.Regular output costs $40 per unit,overtime production is $60 per unit,and subcontracting is $70 per unit.Holding inventory from one month to the next costs $2 per unit per month and a backlog costs $5 per unit per month.Regular plant capacity is 300 units per month.

-Use the information in Table D.4.If the planner decides to adopt a chase plan for the planning period,what will the regular output be for month 1?
A)300 units
B)350 units
C)400 units
D)450 units

Question

Table D.4
Bahouth Enterprises produces a variety of hookahs for clients around the globe.Their small plant has a highly flexible workforce that can switch between products seamlessly.They forecast using a six-month planning period and have a demand forecast as shown in the table.The per-unit costs for each output option the sales and operations planner has at his disposal are indicated in the table.Regular output costs $40 per unit,overtime production is $60 per unit,and subcontracting is $70 per unit.Holding inventory from one month to the next costs $2 per unit per month and a backlog costs $5 per unit per month.Regular plant capacity is 300 units per month.
 
-Use the information in Table D.4.If the planner decides to adopt a chase plan for the planning period,what will the regular output be for month 1?
A)300 units 
B)350 units 
C)400 units 
D)450 units

Quizplus · Accepted Answer

A chase plan involves adjusting production to match demand exactly. If the demand for month 1 is 300 units, then the regular output will also be 300 units.

Table D.4 Bahouth Enterprises Produces a Variety of Hookahs for Clients Around