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A farm supply shop produces four inch biodegradable pots at a rate of 5,000 per day. It supplies pots to growers at a steady rate of 250 per day and the factory operates 300 days per year. The cost to setup the equipment is $22 and the cost of holding a four inch pot is $.15 per year.
a) What is the optimal run size (round to the nearest integer)?
b) How many production runs will there be each year (round to the nearest integer)?
c) What is production run time in days?
d) What is the annual setup cost?
e) What is the maximum and average inventory level?
f) What is the total annual holding cost?
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