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( 1 0 points ) Generic Co . produces hand - made children's toys with a capacity of 2 4 toys a day, 3 0

(10 points) Generic Co. produces hand -made children's toys with a capacity of 24 toys a day, 300 days a year. Their annual demand is 500 toys. The unit variable cost of a toy is $22 while fixed cost for is $100 while the storage and insurance for finished goods costs $20 per year per toy (3 pts) Compute the optimal production batch size b(3 pts) Compute the maximum level of inventory in each cycle (4 pts) Generic Co. considers buying from Distinct Inc., a supplier that makes mass produced toys for $20 with an ordering cost of $200. Would this decision help decreasing their costs ?

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