Setup cost for the production process

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Reference no: EM13763233

The Handy Manufacturing Company manufactures small air conditioner compressors. The estimated demand for the year is 15,000 units. The setup cost for the production process is $250 per run, and the carrying cost is $10.00 per unit per year. The daily production rate is 100 units per day, and demand has been 50 units per day. Determine the optimal number of units to produce in each batch. (The problem assumes 300 operating days.)

Reference no: EM13763233

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