this: Utilize EPQ Principles: Implement EPQ to optimize production quantity, reduce operational costs, and improve efficiency. This approach accounts for setup costs, holding costs, and production constraints, aligning with ACME's objectives. Address Defects and Rework: Project the financial impact of defects and rework. Implement measures to reduce defects and streamline the rework process to minimize associated costs. Evaluate Capacity Against Seasonal Demand: Assess existing capacity relative to seasonal demand fluctuations. Adjust production schedules or invest in capacity enhancements as needed to align with demand patterns. Current Situation Analysis: 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