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Operations Management MNGT401 Fall 2019/2020 Assignment: Submitted To Nitin Kumar Upadhye

The document is an operations management assignment submitted by Jubira Mohammed Saeed Al Odaili Al Ameri to Nitin Kumar Upadhye. It includes answers to multiple questions involving regression analysis to forecast demand, calculating economic order quantity, determining the number of orders and time between orders under a periodic review system, and comparing chase and level production strategies in aggregate planning.

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58 views5 pages

Operations Management MNGT401 Fall 2019/2020 Assignment: Submitted To Nitin Kumar Upadhye

The document is an operations management assignment submitted by Jubira Mohammed Saeed Al Odaili Al Ameri to Nitin Kumar Upadhye. It includes answers to multiple questions involving regression analysis to forecast demand, calculating economic order quantity, determining the number of orders and time between orders under a periodic review system, and comparing chase and level production strategies in aggregate planning.

Uploaded by

aboubakr soultan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Operations management

MNGT401
Fall 2019/2020
Assignment

Submitted to
Nitin Kumar Upadhye

Submitted by
Jubira Mohammed Saeed Al Odaili Al Ameri
ID: # S0000001925
Answer Q1(

Let the months be denoted by x and demand by y


Let the Regression line be y = b0 + b1x
where,
b0 = ( Σy Σx2 - Σx Σxy ) / ( nΣx2 - (Σx)2 ) b1 = ( nΣxy - ΣxΣy ) / ( nΣx2 - (Σx)2 )
Month x Demand (y) x2 xy
Jan 1 410 1 410
Feb 2 430 4 860
Mar 3 390 9 1170
Apr 4 450 16 1800
May 5 570 25 2850
Jun 6 690 36 4140
Jul 7 780 49 5460
Aug 8 790 64 6320
Sep 9 820 81 7380
Total 45 5330 285 30390
b0 = ( 5330*285 - 45*30390 ) / ( 9*285 - 452 ) = 280.56
b1 = ( 9*30390 - 45*5330 ) / ( 9*285 - 452 ) = 62.33
Hence, y = 280.56 + 62.33x
For Nov, x = 11 => y = 280.56 + 62.33*11 = 966.19
For Dec, x = 12 => y = 280.56 + 62.33*12 = 1028.52

.
Answer Q2(

(a)
EOQ = [ 2 x D xS /Px H]1/2
EOQ = [ 2 x 18000 x 200 /220x0.05]1/2
EOQ = 809
(b)
Number of orders = annual demand / EOQ
Number of orders = 18000/809
Number of orders ==22.24
(c)
Expected Time between orders = Number of days / number of orders
Expected Time between orders = 250/22.24
Expected Time between orders =11.241
(d)
Total annual cost = ordering cost + holding cost
Total annual cost = 22.24 x 200 + 809/2 x11
Total annual cost = 8898

.
Answer : Case of Aggregate planning

Production rate per employee=60/15 =4 units/period

Per unit production cost =3,200 /4 =800 $ /unit

In case of chase strategy, total production per period is equal to the demand
during that period.

We calculate ,ending inventory =production in that period Beginning Inventory-


Demand in that period

Total cost =Production cost Hiring cost Firing cost Inventory carrying cost

Total cost using chase strategy=752400 $

.
In case of level strategy ,production is fixed at a certain level. We fix the level of
production=average of the demand of the six periods.

We set production level=784 units/period and calculate the total cost.

Total cost of level strategy=388208 $

Period 1 2 3 4 5 6 7 8 9 10 11 12
Demand 1000 110 120 900 800 700 600 500 400 600 700 900
0 0
Beginning 400 380 360 340 320 300 280 260 240 220 210 200
inventrory
workforce 1 1 2 1 1 1 1 1 1 1 1 1
required
Total 784 784 784 784 784 784 784 784 784 784 784 784
Production
Ending 400 400 400 400 400 400 400 400 400 400 400 400
inventroy
Worker 0 1 1 0 0 0 0 0 0 0 0 0
Hired
Worker fired 0 1 1 0 0 0 0 0 0 0 0 0
Production 1184 118 118 118 118 118 118 118 118 118 118 118
Cost 4 4 4 4 4 4 4 4 4 4 4
Hiring Cost 0 600 600 0 0 0 0 0 0 0 0 0
0 0
Firing Cost 0 700 700 0 0 0 0 0 0 0 0 0
0 0
inventrory 4000 380 360 340 320 300 280 260 240 220 200 180
carrying cost 0 00 00 00 00 00 00 00 00 00 00 00
Total cost 4118 521 501 351 331 311 291 271 251 231 211 191
4 84 84 84 84 84 84 84 84 84 84 84
Total 3882
08

Total cost of level strategy is lower than the total cost of chase strategy. Hence,
level strategy is more efficient for this scenario and leads to cost savings for the
company.

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