A Firm's Demand in the Next Four Quarters (Its Aggregate

question 24

Multiple Choice

A firm's demand in the next four quarters (its aggregate planning horizon) is forecast to be 80, 50, 40, and 90 units. Last quarter, the firm produced 60 units. If it uses level scheduling, the firm will.

• A) hire workers to permit production of 65 units per quarter for the next four quarters
• B) hire 20 workers
• C) have an increase in inventory of 20 units in the next quarter
• D) have a decrease in inventory of 5 units in the next quarter
• E) change its workforce each quarter so that inventory does not change

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Definitions:

Marginal Probability

is the probability of an event occurring without considering other related events.

Coefficient of Correlation

The coefficient of correlation, also known as Pearson's r, measures the strength and direction of a linear relationship between two quantitative variables.

Marginal Probability

The probability of an event occurring in a probability distribution, regardless of the outcome of other variables.

Probability Distribution

A mathematical function that describes the likelihood of getting each possible value that a random variable can assume.