Chapter 12: Problem 5 page 434:
You have become concerned about the amount of copier paper used in your office after repeatedly running out of supplies. Your assistant keeps track of the number of reams (packages of 500 sheets) for 24 weeks:
- Compare the effectiveness of two-week, four-week, and six-week moving averages. Which should you use to forecast copier paper use during the next week?
- Compare the performance of the simple exponential smoothing model with smoothing constants of 0.01, 0.05, and 0.25. Assume a forecast for week 1 of 230 reams. Which constant worked best?
Chapter 12: Problem 10 page 436
The following data show the number of laptop computers sold each month at a retail store:
Month Unit Sales
January 200
February 230
March 225
April 240
May 210
June 180
July 160
August 310
September 320
October 270
November 250
December 300
- Assuming the estimated trend from May to June was -4 and the forecast for June was 190, use trend-adjusted exponential smoothing with a= 0.3 and f3 = 0.2 to forecast sales for each of the seven following months: July, August, September, October, November, December, and January.
- Use regression for the data from January to June to create a forecast for each month from July to the following January.
- Compare the two sets of forecasts generated in parts (a) and (b). Which forecast model produces a better MFE? Which produces a better MAD?
Chapter 12: Problem 12 page 436-437
Monthly usage data for pallets used in a distribution center are as follows :
- Calculate the monthly usage index for each month.
- Use simple linear regression to forecast total usage of pallets for year 5.
- Forecast the seasonally adjusted usage for pallets for each month in year 5.
Chapter 13: Problem 4 page 463
six months:
Month May June July Aug Sept Oct
Demand 120 100 100 100 130 150
The firm always plans to meet all demand. The firm currently has 120 workers capable of producing 120 units in a month (1 unit/worker). The workforce can be increased (at a cost of $500 per worker) or decreased (at a cost of $1,000 per worker). Inventory holding cost is $100 per unit per month. The firm currently has 40 units of inventoryon hand, and it would like to have 40 units available at the end of each month. Regular production cost is $3,000 per unit.
- What should the aggregate plan be if the inventory holding cost is to be minimized?
- What is the cost of this plan?
Chapter 13: Problem 6 page 464
JokersRWild makes playing cards in several different styles, but a “standard” deck of cards is used for planning purposes. The average worker at JokersRWild can make 10,000 decks of cards per month at a cost of $1.00 per deck during regular production and $1.30 during overtime. The company currently employs 25 workers. Experience shows that it costs $500 to hire a worker and $500 to fire a worker. Inventory carrying cost is $.25 per deck per month. Given the following demand estimate, develop a six-month production plan based on (a) level production, (b) chase using overtime (no workers will be fired
and inventory increases if necessary), and (c) chase by changing workforce level. The beginning inventory is 50,000, and at least that amount is desired each month.
Month January February March April May June
Demand 200,000 150,000 200,000 400,000 550,000 250,000
Chapter 13: Problem 9 page 465
Togo makes riding lawn mowers and tractors. The company’s expected quarterly demand is given below in the chart. The company will have 300 mowers in inventory at the beginning of the quarter and desires to maintain at least that number at the end of each quarter. Other critical data include:
Production cost per unit = $200
Inventory carrying cost per quarter per unit= $60 (based on ending quarter inventory)
Hiring cost per worker = $500
Firing cost per worker= $750
Beginning number of workers = 40
Each worker can produce 100 units per quarter.
Complete the tables and determine the cost of the two plans.
