Solved: What is the optimal number of discs to produce at a time, Operation Management

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What is the optimal number of discs to produce at a time

Assignment:

Lindsay Hawkes sells discs that contain 25 software packages that perform a variety of financial functions typically used by business students. Depending on the quantity ordered, Lindsay offers the following price discounts:

1631_Order Quantity.jpg

The annual demand is 3,000 units on average. Lindsay's setup cost to produce the discs is $350. She estimates holding costs to be 10% of the price, or about $1 per unit per year. What is the optimal number of discs to produce at a time?

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Operation Management: What is the optimal number of discs to produce at a time

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