iii. Costs to include: labor + inventory holding + regular productioniv. No subcontracting, no hiring/firing, no overtime.Chase Strategyi. Match daily production to each month's forecasted demand.ii. Adjust workforce monthly to achieve this match.iii. Include hiring and layoff costs where applicable.iv. No inventory, subcontracting, or overtime.Hybrid Strategyi. Base production set at 50 units per day.ii. Allow overtime for up to 6 additional units per day.iii. Use subcontracting only if demand exceeds base + overtime capacity.iv. Inventory allowed for surplus production.v. Include costs of labor, overtime, subcontracting, and inventory.vi. Do not forget to include hiring/firing costs if needed\# of WorkersRegular ProductionOvertime ProductionCost Regular ProductionCost Overtime ProductionCost SubcontractingCost InventoryCost Hiring/Firing Chapter 13- Aggregate Planning and S\&OP1- ThermoHome, a growing manufacturer of energy-efficient space heaters, is preparing its production plan for the next six months (January to June). The company operates with a single production line and sells to both retailers and direct consumers. Demand fluctuates seasonally, with colder months driving higher sales.Based on recent forecasts, total expected demand over the six-month horizon is \(\mathbf{7,200}\) units, distributed unevenly across months. The company operates between 18 and 22 working days per month, with each unit requiring 1.5 labor-hours to produce. ThermoHome currently employs 12 workers, each working a standard 8-hour day.Management is considering three alternative planning strategies:a. A Level Strategy, maintaining a consistent production rate across all monthsb. A Chase Strategy, adjusting labor levels monthly to match forecasted demand exactlyc. A Hybrid Strategy, where a base production rate is maintained (e.g.,50 units/day), supplemented with overtime (up to 6 units/day), and subcontracting is used when demand exceeds even overtime capacity.The following costs apply:- Regular labor: \$11/hour- Overtime labor: \(\$ 17\) hour (beybnd 8 hours/day)- Inventory holding cost: \(\$ 4/\) unit/month- Subcontracting cost: \$24/unit- Hiring cost: \(\$ 350\) per additional daily unit capacity- Layoff cost: \(\$ 700\) per reduced daily unit capacityHINTS:Level Strategyi. Maintain a constant daily production rate based on average demand over the 6 months.ii. Excess production is stored in inventory and used to cover higher demand in later months.iii. Costs to include: labor + inventory holding + regular productioniv. No subcontracting, no hiring/firing, no overtime.Chase Strategyi. Match daily production to each month's forecasted demand.ii. Adjust workforce monthly to achieve this match.iii. Include hiring and layoff costs where applicable.iv. No inventory, subcontracting, or overtime.