Suppose the Waterford Crystal company can produce up to 100 iced-tea pitchers per day. Now suppose that the plant is open 250 days per year and that the annual demand is for 20,000 pitchers. The cost to hold a pitcher in inventory for a year might be $10, and the cost to set up the facility to produce iced-tea pitchers might be $40. Answer the following questions:

What batch size would you recommend for iced-tea pitchers?

How many batches per year should be produced?

What are the annual setup and inventory costs for iced-tea pitchers?