Question

Foggy optics, inc. makes laboratory microscopes. setting up each production run costs $2500. Insurance costs, based on the average number of microscopes in the warehouse, amount to $20 per microscope per year. storage costs, based on the maximum number of microscopes in the warehouse, amount to $15 per microscope per year. suppose that the company expects to sell 1600 microscopes at a fairly uniform rate throughout the year, determine the number of production runs that will minimize the company's overall expenses.

Answer 1

20