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

Question 61

Multiple Choice

Consider the estimated aggregate demand for a company's ski product line for the upcoming year in the following table.Calculate the total costs for the month of March using the level production strategy.Assume the regular time production cost as $200/pair of skis,and the average monthly inventory holding cost is $20/pair of skis per month.  Month  Demand  (in pairs  of unit)   Month  Demand  (in pairs  of units)   J an 8,000 J uly 1,000 Feb 7,000 Aug 1,300 Mar 5,000 Sept 2,000 Apr 4,000 Oct 3,000 May 2,000 Nov 5,700 J une 2,000 Dec 7,000\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) $810,000
B) $900,000
C) $880,000
D) $850,000

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