What is the setup cost in this operation

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A Just-in-Time production line is being optimized to produce a quantity of 500,000 units per year in a plant which has 240 work days per year. A daily production rate of 6,000 units per day is possible, more than needed to fulfill demand. The holding cost is $4 per unit. It is desired to produce the units in small lots of 1,500 at a time, as this is the EOQ. What is the setup cost in this operation?

Reference no: EM131808437

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