Wilson Publishing Company produces books for the retail market. Demand for a current book
is expected to occur at a constant annual rate of 7200 copies. The cost of one copy of the
book is $14.50. The holding cost is based on an 18% annual rate, and production setup costs
are $150 per setup. The equipment on which the book is produced has an annual production
volume of 25,000 copies. Wilson has 250 working days per year, and the lead time for a
production run is 15 days. Use the production lot size model to compute the following
a. Minimum cost production lot size
b. Number of production runs per year
c. Cycle time
d. Length of a production run
e. Maximum inventory
f. Total annual cost
g. Reorder point
