Aggregate Planning: Level Production Strategy

Production cost $($$$/$unit$)$ $$75\mathrm{.}00$

Inventory holding cost $($$$/$unit$)$ $$1\mathrm{.}20$

Lost sales cost $($$$/$unit$)$ $$81\mathrm{.}00$

Overtime cost $($$$/$unit$)$ $$6\mathrm{.}70$

Undertime cost $($$$/$unit$)$ $$2\mathrm{.}80$

Rate change cost $($$$/$unit$)$ $$5\mathrm{.}20$

Normal production rate $($units$)2,100$

Ending inventory $($previous Dec.$)1,100$

Cumulative

Cumulative Product Ending Lost

Month Demand Demand Production Availability Inventory Sales