Develop a Level Aggregate Plan Using Inventory and Back Orders

question 10

Essay

Develop a level aggregate plan using inventory and back orders (data given above).
(a) What is the production rate per period?
(b) No overtime is to be used. What is the required workforce level and how many workers are hired or fired at the beginning of period 1?
(c) What is the maximum ending inventory and when does it occur?
(d) What is the maximum amount of back orders and when does it occur?
(e) What is the total cost?
(f) What is the cost per unit?

---

Definitions:

Protective Tariff

A tax imposed on imported goods to protect domestic industries from foreign competition by making the imported goods more expensive.

Tariff

A tax imposed by a government on goods and services imported from other countries.

Excise Tax

An indirect tax charged on the sale of a particular good or service, typically specific items such as alcohol, tobacco, and gasoline.

Revenue Tariff

A type of tariff that is primarily levied by a government with the objective of generating income rather than protecting domestic industries.