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All - Star bats sells aluminum bats to colleges. The monthly demand for bats is 1 5 0 0 ( throughout the year ) ,
AllStar bats sells aluminum bats to colleges. The monthly demand for bats is throughout the year and it costs $ to produce a bat. The holding cost is about $ per bat per year. It costs $ to set up each production run.
How many bats should All Star produce in each production batch?
Assume the holding cost and price of a bat in the market are fixed. A foreman has proposed that the production cost of a bat can be reduced by cents by making a process change. However, this will increase the setup cost to $ Should AllStar implement this change?
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