A company produces heaters. Demand during each of the next 12 months is forecasted as shown below. Other relevant information is as follows:
* Workers are paid $5000 per month.
* It costs $500 to hold a heater in inventory for a month. The holding cost is based on each month's ending inventory.
* It costs $4000 to hire a worker.
* It costs $20,000 to fire a worker.
* Each worker can make up to 8 heaters a month.
* At the beginning of month 1, there are 500 heaters in inventory and 60 workers.
This information is summarized below:
Demand:
Month 1: 945
Month 2: 791
Month 3: 364
Month 4: 725
Month 5: 268
Month 6: 132
Month 7: 160
Month 8: 304
Costs:
Pay: $5,000 per month
Hold Cost: $500 per heater
Hire: $4,000 per worker
Fire: $20,000 per worker
Productivity: 8 heaters/month
Initial Inventory: 500 heaters
Initial Workers: 60 workers