Question: Problem 2: A certain fertilizer product has an almost constant demand of 125,000 bags per month. The plant can produce l,000 bags per hour and

Problem 2: A certain fertilizer product has an almost constant demand

Problem 2: A certain fertilizer product has an almost constant demand of 125,000 bags per month. The plant can produce l,000 bags per hour and each month has 250 production hours. The setup cost is $800 per run. Holding cost of a fertilizer bag is $0.l per year. What will be the best production quantity of this product in each production run? [2 Marks]

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