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Dan bumblauskas is the owner of a small iowa company that produces electric knives used to cut fabric. the annual demand is for 8,000 knives, and dan produces the knives in batches. on​ average, dan can produce 130 knives per​ day; during the production​ process, demand has been about 50 knives per day. the cost to set up the production process is ​$95​, and it costs dan ​$1.00 to carry a knife for 1 year. how many knives should dan produce in each​ batch?

User Vince VD
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1 Answer

1 vote

Final answer:

Dan should produce around 129 knives in each batch to meet the annual demand.

Step-by-step explanation:

To determine how many knives Dan should produce in each batch, we need to find the optimal batch size that minimizes the total cost. Let's break it down:

  1. Calculate the number of batches needed by dividing the annual demand by the daily production rate: 8,000 / 130 = 61.54 batches.
  2. Round up the number of batches to the nearest whole number: 62 batches.
  3. Calculate the average daily demand for each batch: 8,000 / 62 = 129.03 knives.

Therefore, Dan should produce around 129 knives in each batch to meet the annual demand.

User Mingle Li
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