A retailer experiences a seasonal demand pattern for its services.Labor requirements over a typical six-month period follow.
Costs associated with operations are as follows:
Wages = $2,000 per worker per month
Hiring cost = $1,000 per worker
Layoff cost = $1,500 per worker
The current workforce level is 10 workers.Use the spreadsheet approach and the preceding data to answer the following questions:
a.What is the total cost of a staffing plan,including the cost of regular wages,hiring,and layoffs using a chase strategy with hiring and layoffs,but no overtime?
b.What is the total cost of the staffing plan,using a level strategy in which no overtime is allowed and the undertime paid for?
c.Suppose that overtime is allowed up to 25% of the regular-time capacity,and that overtime wages are 150% of the regular-time rate.What is the total cost of the level strategy with overtime and undertime that also minimizes undertime?

Question

A retailer experiences a seasonal demand pattern for its services.Labor requirements over a typical six-month period follow.
  Costs associated with operations are as follows:
Wages = $2,000 per worker per month
Hiring cost = $1,000 per worker
Layoff cost = $1,500 per worker
The current workforce level is 10 workers.Use the spreadsheet approach and the preceding data to answer the following questions:
a.What is the total cost of a staffing plan,including the cost of regular wages,hiring,and layoffs using a chase strategy with hiring and layoffs,but no overtime?
b.What is the total cost of the staffing plan,using a level strategy in which no overtime is allowed and the undertime paid for?
c.Suppose that overtime is allowed up to 25% of the regular-time capacity,and that overtime wages are 150% of the regular-time rate.What is the total cost of the level strategy with overtime and undertime that also minimizes undertime?

Quizplus · Accepted Answer

The Answer of A retailer experiences a seasonal demand pattern for its services.Labor requirements over a typical six-month period follow.
  Costs associated with operations are as follows:
Wages = $2,000 per worker per month
Hiring cost = $1,000 per worker
Layoff cost = $1,500 per worker
The current workforce level is 10 workers.Use the spreadsheet approach and the preceding data to answer the following questions:
a.What is the total cost of a staffing plan,including the cost of regular wages,hiring,and layoffs using a chase strategy with hiring and layoffs,but no overtime?
b.What is the total cost of the staffing plan,using a level strategy in which no overtime is allowed and the undertime paid for?
c.Suppose that overtime is allowed up to 25% of the regular-time capacity,and that overtime wages are 150% of the regular-time rate.What is the total cost of the level strategy with overtime and undertime that also minimizes undertime?

A Retailer Experiences a Seasonal Demand Pattern for Its Services