Autoco produces cars. Demand during each of the next 12 months is forecasted to be 945, 791, 364, 725, 268, 132, 160, 304, 989, 293, 279, and 794. Other relevant information is as follows:
■ Workers are paid $5000 per month.
■ It costs $500 to hold a car in inventory for a month. The holding cost is based on each month’s ending inventory.
■ It costs $4000 to hire a worker.
■ It costs $20,000 to fire a worker.
■ Each worker can make up to 8 cars a month.
■ Workers are hired and fired at beginning of each month.
■ At the beginning of month 1 there are 500 cars in inventory and 60 workers.
How can the company minimize the cost of meeting demand for cars on time?