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A company can produce a part it uses in an assembly operation at the rate of $50 an hour. The company operates 8 hours a day, 300 days a year. Daily usage of the part is 300 parts. The company uses the part very day. The run size is 6000 parts. The holding cost is $2 per unit, and setup cost is $100.
1) While production is occurring, how many parts per day are being added to inventory?
2) Assuming that production begins when there are no parts on hand, what is the maximum number of parts in inventory?
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