Evaluate the existing capacity against seasonal demand as a function of under-utilization or overcapacity. Inventory: 10,000 units at $5 holding cost per unit per month.

● Ordering: Average order cost is $100 for 2,000 units. 

● Operating Schedule: 300 days per year. 

● Manufacturing: 7 steps with specified cycle times, 10% defect rate, and a $15 rework cost per defective unit. 

● Demand: Seasonal variance with 500 units/day at peak and 150 units/day at trough. 

● Production: Maximum capacity is 400 units/day. 

● Costs: Fixed costs at $600,000/year, variable cost at $250/unit, and selling price at $500/unit.

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