Consider the following sales and operations planning (aggregate planning) problem. Consider period 3. Let the beginning inventory be 300 and the desired ending inventory in period 3 be 500. What is the demand for period 3, if the production required to meet the demand under these conditions is 1200?
a.1,000
b.1,200
c.1,400
d.800
e.1,400
Expert Answer
The equation we use is
Ending Inventory = Beginning Inventory + Production – Demand
which means Demand = Beginning Inventory + Production – Ending Inventory
The data given is
Beginning Inventory = 300
Production = 1200
Ending Inventory = 500
Substituting the values, we get
Demand = 300 + 1200 – 500 = 1000
So, the answer
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