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Johnson Plastics makes and sells, among many other things, specialty plastic display cases for retail stores. Johnsons expected demand for the display cases is 1,000 units, and average daily demand is 3 units. The production process is most efficient when 12 units per day are produced at a cost of $119 per unit. Setup cost is $39. Inventory carrying cost at Johnson is determined to be 8 percent annually.
1. What is the best production order quantity?
2. How many days is a required production run?
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Could someone help me to figure out this case? Thanks very much. Alex Hamilton founded Hamilton Marketing Services in 1999 after leaving a major marketing consulting firm in Chicag
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