The company wants to maintain a minimum cash balance of $35,000 and borrows from the local bank as needed in increments of $1,000 at the beginning of the quarter. Principal repayments are made at the beginning of the quarter when excess funds are available and in increments of $1,000. Interest is 6% per year and paid at the beginning of the quarter based on the amount outstanding from the previous quarter.

Amanager of a store that sells and installs spas wants to prepare a forecast for january and june of next year. her forecasts are a combination of trend and seasonality. she uses the following equation to estimate the trend component of monthly demand: ft = 30+5t, where t = 1 in january of this year. seasonal relatives are 0.60 for january and 1.50 for june. what demands should she predict for january and june of next year