Suppose you have been given responsibility for developing thesix-month aggregate production plan at Soda Galore, a manufacturerof soft drinks. Your company makes three types of soft drinks:regular, diet, and super-caffeinated. Fortunately, all three typesare made using the same production process, and the costs relatedto switching between the three types are so minimal that they canbe ignored. Thus, you can treat your problem as an aggregateplanning exercise where the planning unit is cases of soft drinks,regardless of what types of drinks they are.

January	16,000 cases
February	24,000 cases
March	32,000 cases
April	32,000 cases
May	60,000 cases
June	88,000 cases
Total Demand	252,000 cases
Average Monthly demand	42,000 cases

Current workforce	10 workers
Average monthly output per workder	2000 cases per month
Inventory holding cost	$0.30 cases per month
Regular wage rate	$36 per hour
Regular production hours/month/worker	100 hours
Overtime wage rate	$54 per hour
Hiring cost	$1000 per worker
Firing cost	$1500 per worker
Subcontracting cost	$2.90 per cases
Beginning inventory	7000 (all safety stock)

Assume that employees negotiate an increase in the regularproduction wage rate to $40 per hour and $60 per hour for overtime.Also assume that Soda Galore always plans to hold at least 7,000cases of safety stock to meet unanticipated customer demand. Assumethat hiring and layoff/firing, if necessary, occur at the beginningof the month.

a) Determine the cost of the level production plan.

b)Determine the cost of the chase production plan.

Total cost is workforce size adjusted	???
Total cost if overtime production used	???
Total cost if subtracting used	???

c)After much internal discussion, the company decides tomaintain a permanent workforce of 10 production workers. Given thesame planning information and this new requirement, develop asix-month production plan based on hybrid production. Determine thecost of the hybrid production plan. Use the overtime cost.