n 2018, David Tucker quit his job at a large beer company to start his own brewerey, Arkansas Microbrewery Inc. (AMI). His family supported his decision and invested in the business along with David AMI began operations on January 10, 2018 and now produces four labels of specialty beers (Fayetteville Pale Ale, Little Rock Bock, Fort Smith Amber Pilsner, and Springdale Stout). Appendix A explains the beer-making process. In much of the United States (including Arkansas), beer is sold in a 'three-tier' system. Under this sytem, beer is manufactured by producers, sold to beer distributors, who then sell to retailers (such as liquor stores, drug stores, and grocery stores). Since the pandemic, individual customers could also buy directly from AMI. David employs two salespeople who receive a fixed monthly salary plus 8 percent commission regardless of whether beer sales as generated through beer distributor relationships or through online customers. All beer sales (primarily in the Southwest U.S.) are in cases of 24 bottles. David rents a facility that is used to make the beer, and a refrigeration area to store the beer, and a small office area. AMI brewery has five machines with 9,300 machine hours available per year to produce beer (assuing AMI remains on one shift with some normal maintenance, breaks, etc.). While there is an empty space in the facility that could be used to expand the beer operations, the company would need tp urchase an additional grain hopper and brew house for about $100,000 (the current water system and process control system could be expanded to handle the new machine). As discussed in Appendix A, beers are aged in a refrigeration area prior to sale. The current refrigeration unit allows for different temperatures in different areas of the unit and the unit is usually running about 80 percent full. Keeping the refrigeration unit somewhat full helps reduce refrigeration costs. This is because opening and closing the refrigeration unit when it is very empty results in a greater temperature drop as more warm air gets into the refrigeration unit copmared to when the refrigeration unit is full; thus, keeping the refrigeration unit somewhat full helps reduce refrigeration costs. Additionally, since the company is somewhat new, sales have been growing but erratic (from 2018 to 2019, sales growth was over 45 percent; however from 2019 to 2020, sales growth was only 12 percent). Thus, keeping more beer on hand allows the company to meet the erratic demand without loss of sales.