What is the optimal size of the production run


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Q: Radovisky Manufacturing Company, in Hayward, California, makes flashing lights for toys. The company operates its production facility 300 days per year. It has orders for about 12,200 flashing lights per year and has the capability of producing 100 per day. Setting up the light production costs $49. The cost of each light is $0.95. The holding cost is $0.05 per light per year.

a) What is the optimal size of the production run?

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Operation Management: What is the optimal size of the production run
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