Problem:
The Handy Manufacturing Company manufactures small air conditioner compressors. The estimated demand for the year is 15,000 units. The setup cost for the production process is $250 per run, and the carrying cost is $10.00 per unit per year. The daily production rate is 100 units per day, and demand has been 50 units per day.
Required:
Question: Determine the optimal number of units to produce in each batch.
Note: Solve the problem and show all work.