All problems have equal weight. Provide your answers in an excel file using a separate sheet for each problem.
Problem 1 – Demand Forecasting
Company A produces products P1 and P2. Historically, demand for P1 peaks in the summer months, while demand for P2 peaks in the fall months. Based on historical trends, demand is expected to grow until 2012, after which it is expected to plateau.
Using the historical data provided below, select the appropriate forecasting method and forecast the demand for the years 2010 to 2012.
Year
Quarter
P1
P2
2005
I
2250
3200
 
II
1737
7658
 
III
2412
4420
 
IV
7269
2384
2006
I
3514
3654
 
II
2143
8680
 
III
3459
5695
 
IV
7056
1953
2007
I
4120
4742
 
II
2766
13673
 
III
2556
6640
 
IV
8253
2737
2008
I
5491
3486
 
II
4382
13186
 
III
4315
5448
 
IV
12035
3485
2009
I
5648
7728
 
II
3696
16591
 
III
4843
8236
 
IV
13097
3316
Problem 2 – Aggregate Planning
You are the facility production planning manager for Company A. Your problem is to determine a 3-year aggregate production plan (planning horizon is from Quarter I of 2010 to Quarter IV of 2012). The company produces two products, P1 and P2. Your team has provided to you a 3-year production plan.
Demand Forecast
Year
Quarter
P1
P2
2010
I
6650
7462
 
II
4576
18250
 
III
6293
8894
 
IV
13777
4064
2011
I
7509
8349
 
II
5149
20355
 
III
7056
9891
 
IV
15399
4507
2012
I
8367
9235
 
II
5721
22461
 
III
7819
10889
 
IV
17021
4950
Furthermore, it has gathered various data for the production, possible subcontracting options, labor costs, inventory handling costs, material costs and others. In particular, the production floor consists of 9 machines. Each machine can produce 4 items (either P1 or P2) per hour. The fixed cost for operating a machine is 200$ per quarter, and requires for its operation…