Question: HAL Ltd., discussed in Problem 9, can produce the disk drive housings in the Hamilton, Ontario, plant at a rate of 150 housings per month.

HAL Ltd., discussed in Problem 9, can produce the disk drive housings in the Hamilton, Ontario, plant at a rate of 150 housings per month. The housings cost HAL $85 each to produce, and the setup cost for beginning a production run is $700. Assume an annual interest rate of 28 percent for determining the holding cost.

a. What is the optimal number of housings for HAL to produce in each production run?

b. Find the time between initiation of production runs, the time devoted to production, and the downtime each production cycle.

c. What is the maximum dollar investment in housings that HAL has at any point in time?

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