A local company makes athletic clothing and they are preparing aggregate production plans on a quarterly basis for the coming year for their line of women's wear. They have the following information available to develop a level capacity and a matching (chase) demand plan:
(Assume that pattern of demand repeats each year, that is the demand in quarter 4 of the previous year was 13,000 units)
Number of working days per quarter = 65 days
Number of hours per day per person = 8 hours
Labor to produce one unit = 5 hours
Demand for four quarters respectively:
12,300, 12,500, 12,200, 13,000 units
Cost of hiring a worker = $800
Cost of laying off a worker = $500
Inventory carrying cost per unit per year = $60
Using a level capacity plan, how many workers are needed each quarter?
A) 118
B) 121
C) 125
D) 130
E) 134
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