month expected demand production date demands per day

Jan 900 22 41
Feb 700 18 39
Mar 800 21 38
Apr 1200 21 58
May 1500 22 68
Jun 1100 20 55
total: 6200 124 50

/
Average Req. = total expected demand total number of production days
= 6200/124
= 50 units per day
Units per day = 8 hrs/day / 1.6 hrs/unit = 5 units per day

Workers required = 50 units/day / 5 units/day = 10 workers

Cost Information
Holding Cost $5/month
Subcontracting Cost per unit $10/unit
Average Pay Rate $5/hour ($40/day)
$7/hour(over
Overtime Pay Rate
8hrs/day
Labor-Hours per Unit 1.6 hrs/unit
Cost of Increasing
Production Rate (Hiring and $300/unit
Training)
Cost of Decreasing daily
$600/unit
Production Rate (Layoff)