The president of Hill Enterprises, Terri Hill, projects the firms aggregate demand requirements over the next 8 months as follows:
Jan 1,400 May 2,200
Feb 1,600 June 2,200
Mar 1,800 July 1,800
Apr 1,800 Aug 1,400
Plan A: Vary the workforce level to execute a "chase" strategy by producing the quantity demanded in the prior month. The December demand rates of production crew both 1,600 units per month. The cost of hiring additional workers is $5,000 per 100 units. The cost of laying off workers is $7,500 per 100 units. Evaluate this plan.