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A local t-shirt production company has opened a retail store adjacent to the production plant. The plant manager wishes to optimize the inventory costs of the company's best-selling T-shirt. The annual demand for the T-shirt is 36,000 and the plant works 240 days per yr. The plant can produce the t-shirt at a rate of 320 per day. The cost to prepare the equipment to start a production run is $380 and the annual inventory carrying cost is $3.6 per year.
-What should be the optimum quantity of t-shirts to produce?
-What is the maximum inventory achieved during a production run?
-How many production runs are needed to meet the annual demand?
-What is the average inventory of t-shirts?
-What is the total annual cost of producing and storing the company's best-selling t-shirts?
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