Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the firing cost for month of February using the chase production strategy.The average number of hours required to produce a pair of skis is 8 hours,and the number of worker hours per month is 160.The current workforce is 100.The firing cost per worker is $200. $$\begin{array} { | c | c | c | c | }
\hline \text { Month } & \begin{array} { c }
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c }
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$
A)$12,000
B)$15,000
C)$20,000
D)$10,000

Question

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the firing cost for month of February using the chase production strategy.The average number of hours required to produce a pair of skis is 8 hours,and the number of worker hours per month is 160.The current workforce is 100.The firing cost per worker is $200. $$\begin{array} { | c | c | c | c | } 
\hline \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of unit) }
\end{array} & \text { Month } & \begin{array} { c } 
\text { Demand } \
\text { (in pairs } \
\text { of units) }
\end{array} \
\hline \text { J an } & 8,000 & \text { J uly } & 1,000 \
\hline \text { Feb } & 7,000 & \text { Aug } & 1,300 \
\hline \text { Mar } & 5,000 & \text { Sept } & 2,000 \
\hline \text { Apr } & 4,000 & \text { Oct } & 3,000 \
\hline \text { May } & 2,000 & \text { Nov } & 5,700 \
\hline \text { J une } & 2,000 & \text { Dec } & 7,000 \
\hline
\end{array}$$
A)$12,000
B)$15,000
C)$20,000
D)$10,000

Quizplus · Accepted Answer

To calculate the firing cost for February using the chase production strategy, first determine the number of workers needed for February's demand. February's demand is 7,000 pairs of skis. Each pair requires 8 hours to produce, so total hours needed = 7,000 pairs * 8 hours/pair = 56,000 hours. Given each worker works 160 hours per month, the number of workers needed = 56,000 hours / 160 hours/worker = 350 workers. The current workforce is 100 workers, so to meet February's demand, the company would actually need to hire more workers, not fire any. Therefore, the firing cost for February is $0, which is not an option provided, indicating a misunderstanding in the question's premise. However, if we were to calculate based on reducing workers, the calculation would involve determining the difference in workforce requirements between months, which isn't applicable here as the demand increases from January to February. The correct approach shows no firing cost, but given the options, it seems there's been a mistake in interpreting the demand or the options provided.

Consider the Estimated Aggregate Demand for a Company's Ski Product