2. 1 By: Prof. Y. Peter Chiu 9 / 1 / 2011 PMc3-EG ~ SOLUTION ~

3. 2 #4 (a) InvDem.Adj Dem. K Wor kers Reg’ d chaseProdInv.If adj Wor kers If adj Inv. 400Dec. 30 100Jan.10007002528 -27000 28 0 100Feb.900 2536 +89000 36 0 100Mar.760 2531 -577515 31 15 100Apr.1280 2552 +21130035 51 10 100May.600 2524 -2860035 24 10 280Jun.6208002532 +880035 32 10 780-35+3712045

4. 3 (a) K = (20*8) / 6.4 = 25 Overall costs = 35(400)+37(200)+120(10) +780(10) = $30,400 if adjust costs = 34(400)+36(200)+45(10)+780(10) = $29,050

5. 4 (b) Overall costs = 7(200)+1845(10)+780(10) = $ 27,650 Safety Stock Dem. Adj Dem. Comm. Dem K Workers Reg’d stable Cumm Prod Inv. 100 1000700 2528 37 925 225 100 900 16005032 37 1850 250 100 760 23607532 37 2775 415 100 1280 3640100 37* 37 3700 60 100 600 424012534 37 4625 385 280 620800504015034 37 5550 510 7801845

6. 5 (C) case1 Adj D Cumm D Mix-ST.Cumm K Cumm P Inv. 700 +23225800100 9001600325016000 76023603275240040 12803640+1850129010 6004240-2228710110 80050402881010 +20-22 270 (H)(F)(I) total 4000880027007800 23300

7. 6 (C) case2 Adj D Mix-ST.Cumm P Inv. 7003075050 900+4349000 7603485090 1280+1448129010 600-2028710110 8002881010 +18-20 270 (H)(F)(I) total 3600800027007800 22100

8. 7 (C) case3 Adj D Cumm D Mix-ST.Cumm P Inv. 700 37+7925225 9001600371850250 7602360372775415 1280364037370060 60027-10(675+60)135 80027(675+135)10 1095 (H)(F)(I) total 14004000109507800 24150

9. 8 (C) case4 Adj D Mix-ST.Cumm P Inv. 7003075050 90034+4850+500 76037+3925165 128045+81125+16510 600-1728700+10110 80028700+11010 -17+15345 (H)(F)(I) total 3000680034507800 21050

10. 9 (C) case5 Adj D Mix-ST.Cumm P Inv. 7003075050 90034+4850+500 76041+71025265 1280411025+26510 60028-13700+10110 80028700+11010 +11-13 445 (H)(F)(I) total 2200520044507800 19650  BEST

11. 10 The End