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Unit 6 Assignment: Operational Issues in Supply Chain Management

This assignment will assess your knowledge based on the following Outcome:

MT433-3: Evaluate operational issues in supply chain management.

Being able to calculate production levels and inventory costs is a key component of evaluating the fit of various options to business scenarios. For this assignment, answer the two problems below. Use the template provided to fill in both your answers and your work. If you do not use the template or do not show your work, you will lose points.

Problem 1

Based on the demand shown below, use a (a) chase production strategy and (b) level production strategy to compute the monthly production, ending inventory or backlog, and workforce levels. A worker can produce 50 units per month. Beginning inventory in January is 500 units, and the firm is targeting 200 units of inventory at the end of June.

Month	JAN	FEB	MAR	APR	MAY	JUN
Demand	2000	3000	5000	6000	5000	2000
Production
Ending Inventory
Workforce

Problem 2

Given the following information, compute the economic order quantity, annual holding cost, annual order cost, and annual total inventory cost.

Annual requirements (R) = 50,000 units

Order cost (S) = $150 per order

Holding rate (k) = 15%

Unit cost (c) = $100 per unit