Determine each of the optimum run size

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Reference no: EM131664726

A toy manufacturer uses 48,000 rubber wheels per year for its popular dump truck series. The firm makes its own wheels which it can produce at a rate of 800 per day. The toy trucks are assembled uniformly over the entire year. Carrying cost is $1 per wheel a year. Setup costs for a production run of wheels is $45. The firm operates 240 days per year. Determine each of the following:

A. the optimum run size

B. the minimum total annual cost for carrying and setup

Reference no: EM131664726

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