Answer: $83.02
Explanation:
Desired Lot Size (Q) = 815 units
Annual Demand (D) = 40000 units per year
Holding Cost (H) = $20 units per year
Daily Production Rate (p) = 320 units per day
Daily Demand (d) = 40000/250 = 160 units per day
Setup Cost = S
Q^2 = (2*S*D)/(H*(1-d/p))
815^2 = (2*S*40000)/(20*(1-160/320))
S = $83.02
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