The demand for a product over the next five periods may be filled from regular production, overtime production, or subcontracting. Subcontracting may be used only if the overtime capacity has been used. The following table gives the supply, demand, and cost data of the situation.

The unit production costs for the three levels in each period are $4, $6, and $7, respectively. The unit holding cost per period is $.50. Determine the optimal solution.

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Period 12345 Regular time 100 40 90 60 70 Production capacity (units) Overtime Subcontracting 50 60 80 50 50 30 80 70 20 100 Demand 153 200 150 200 203