What is the best production order quantity


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Q: Johnson Plastics makes and sells, among many other things, specialty plastic display cases for retail stores. Johnson's expected annual demand for the display cases is 1, 600 units, and average daily demand is 8 units. The production process is most efficient when 17 units per day are produced at a cost of $130 per unit Setup cost is $22. Inventory carrying cost at Johnson is determined to be 10 percent annually

a. What is the best production order quantity?

b. How many days is a required production run?

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Operation Management: What is the best production order quantity
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