Suppose that the Waterford Crystal company can produce up to 100 iced-tea pitchers per day.

Further, suppose that the plant is open 250 days per year and that 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:

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

b.How many batches per year should be produced?

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