3 Questions

Right click and save the Red Tomato Demo to your hard drive.Using the original data in the file, what happened to inventory and stockouts over the six periods of the planning horizon?2. Right click and save the Red Tomato Demo for Example 1 to your hard drive.What happened to stockouts as demand fluctuation increased? What happened to profits? What did you learn from this exercise?3. Right click and save the Red Tomato Demo for Example 2 to your hard drive.What happened to the use of subcontractors as holding costs increased? What happened to profits? What did you learn from this exercise?Note: Use the “Solver” capability under the ”Tools” menu for the above three exercises.*Note on using the “Solver” Add-In:The Solver Add-in is an Excel add-in program that is available when you install Microsoft Office or Excel. To use it in Excel, however, you need to load it first. You should have completed doing so in Module 3.
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Tables 8.1,2
Aggregate Planning Dat for Red Tomato
Demand Forecast
Month
January
February
March
April
May
June
Demand Forecast
1,600
3,000
3,200
3,800
2,200
2,200
Costs
Item
Materials cost/unit
Inventory holding cost/unit/month
Marginal cost of stockout/unit/month
Hiring and training cost/worker
Layoff cost/worker
Labor hours required/unit
Regular time cost/hour
Over time cost/hour
Marginal subcontracting cost/unit
Cost
$
$
$
$
$
$
$
$
10
2
5
300
500
4
4
6
30
Page 1
Red Tomato Demo
Aggregate Plan Decision Variables
Ht
Lt
Constraints
Wt
Ot
It
St
# Hired # Laid off # Workforce Overtime Inventory Stockout
0
0
80
0
1,000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
143
Aggregate Plan Costs
Ct
Period
0
1
2
3
4
5
6
Period
Hiring
1
2
3
4
5
6
Total Cost =
Total Revenue =
Profit =
Promote? (0/1)
Month (1/4)
Base Price
Consumption
Forward buy
Lay off
0
0
0
0
0
0
Regular time
0
0
0
0
0
0
0
0
0
0
0
0
Overtime Inventory Stockout
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Subcontract Production Demand Price
0
0
0
1600
40
0
0
3000
40
0
0
3200
40
0
0
3800
40
0
0
2200
40
0
0
2200
40
0
0
0
0
0
0
0
Subcontract Material
0
0
0
0
0
0
$
$ 640,000
$ 640,000
$
Pt
0
1
40
1.00
0.20
Page 2
0
0
0
0
0
0
Workforce Capacity Inventory Over time
-80
0
0
0
0
0
0
0
0
0
0
0
-600
-3000
-3200
-3800
-2200
-2200
0
0
0
0
0
0
Aggregate Plan
4,000
3,500
3,000
2,500
Inventory
Production
2,000
Demand
Stockout
Subcontracting
1,500
1,000
500
0
1
2
3
4
Period
5
6
Table 8.4
Aggregate Planning (Chapter 8-9)
Demand Forecast
Month
January
February
March
April
May
June
Demand Forecast
1.000
3.000
3.800
4.800
2.000
1.400
Costs
Item
Materials cost/unit
Inventory holding cost/unit/month
Marginal cost of stockout/unit/month
Hiring and training cost/worker
Layoff cost/worker
Labor hours required/unit
Regular time cost/hour
Over time cost/hour
Marginal subcontracting cost/unit
Cost
$
$
$
$
$
$
$
$
10
2
5
300
500
4
4
6
30
Page 1
Red Tomato Example 8.1
Aggregate Plan Decision Variables
Ht
Lt
Constraints
Wt
Ot
It
St
# Hired # Laid off # Workforce Overtime Inventory Stockout
0
0
80
0
1.000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
143
Aggregate Plan Costs
Ct
Period
0
1
2
3
4
5
6
Period
Hiring
1
2
3
4
5
6
Total Cost =
Total Revenue =
Profit =
Promote? (0/1)
Month (1/4)
Base Price
Consumption
Forward buy
Lay off
0
0
0
0
0
0
Regular time
0
0
0
0
0
0
0
0
0
0
0
0
Overtime Inventory Stockout
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Subcontract Production Demand Price
0
0
0
1000
40
0
0
3000
40
0
0
3800
40
0
0
4800
40
0
0
2000
40
0
0
1400
40
0
0
0
0
0
0
0
Subcontract Material
0
0
0
0
0
0
$
$ 640.000
$ 640.000
$
Pt
0
1
40
1,00
0,20
Page 2
0
0
0
0
0
0
Workforce Capacity Inventory Over time
-80
0
0
0
0
0
0
0
0
0
0
0
0
-3000
-3800
-4800
-2000
-1400
0
0
0
0
0
0
Aggregate Plan
6.000
5.000
4.000
Inventory
Production
3.000
Demand
Stockout
Subcontracting
2.000
1.000
0
1
2
3
4
Period
5
6
Tables 8.1,2
Aggregate Planning for Red Tomato
Demand Forecast
Month
January
February
March
April
May
June
Demand Forecast
1,600
3,000
3,200
3,800
2,200
2,200
16,000
Costs
Item
Materials cost/unit
Inventory holding cost/unit/month
Marginal cost of stockout/unit/month
Hiring and training cost/worker
Layoff cost/worker
Labor hours required/unit
Regular time cost/hour
Over time cost/hour
Marginal subcontracting cost/unit
Cost
$
$
$
$
$
$
$
$
10
6
5
300
500
4
4
6
30
Page 1
Red Tomato Example 8.2
Aggregate Plan Decision Variables
Ht
Lt
Constraints
Wt
Ot
It
St
# Hired # Laid off # Workforce Overtime Inventory Stockout
0
0
80
0
1,000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
143
Aggregate Plan Costs
Ct
Period
0
1
2
3
4
5
6
Period
Hiring
1
2
3
4
5
6
Total Cost =
Total Revenue =
Profit =
Promote? (0/1)
Month (1/4)
Base Price
Consumption
Forward buy
Lay off
0
0
0
0
0
0
Regular time
0
0
0
0
0
0
0
0
0
0
0
0
Overtime Inventory Stockout
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Subcontract Production Demand Price
0
0
0
1600
40
0
0
3000
40
0
0
3200
40
0
0
3800
40
0
0
2200
40
0
0
2200
40
0
0
0
0
0
0
0
Subcontract Material
0
0
0
0
0
0
$
$ 640,000
$ 640,000
$
Pt
0
1
40
1.00
0.20
Page 2
0
0
0
0
0
0
Workforce Capacity Inventory Over time
-80
0
0
0
0
0
0
0
0
0
0
0
-600
-3000
-3200
-3800
-2200
-2200
0
0
0
0
0
0
Aggregate Plan
4,000
3,500
3,000
2,500
Inventory
Production
2,000
Demand
Stockout
Subcontracting
1,500
1,000
500
0
1
2
3
4
Period
5
6

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