Question

The ­­­­­­­­­________________ strategy consists of averaging out production to ensure that that the forecasted demand is covered over time. This could result in some period having higher production than actual demand and other period where there is more inventory than demand.

Select one:

a. Chase

b. High employment

c. Make to stock

d. Level

Answer 1

· Level

In the level production strategy, production levels are averaged out to meet the forecasted demand in time. Whenever there are low demand periods, the inventory levels will rise and decrease when demand is high. The other options are wrong. Under the chase strategy, production levels are adjusted as per variations in demand. This is a lean strategy as inventory is kept to a minimum. In make to stock strategy, production is matched to anticipated demand.