14. The Retro Appliance Company forecasts demand for its blenders during 12 months as the following:

The current production work force level for the company is 35 employees, and each employee can produce 10 units per month. An employee can produce 11 units by working 10 percent overtime and 12 units by working 20 percent overtime. The cost of hiring an employee is $550, and the cost of laying off an employee is $500. Regular-time pay for an employee is $1,250 per month, with time-and-a-half for overtime. The cost to hold a unit in inventory is $3.50, and the current level of inventory is 840 units, which is about what the company wants to maintain.

a. Create a mixed strategy for meeting the forecast demand.

b. What will be the cost of your strategy?

c. What types of changes do you think might provide a lower-cost strategy?

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January February March 412 units 385 385 April 551. May 665 June 876 July 714 August 631 September 568 October 342 November 559 December 562