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Neilsen Cookie Company Sells Its Assorted Butter Cookies in Containers

Question 21

Multiple Choice

Neilsen Cookie Company sells its assorted butter cookies in containers that have a net content of 1 lb.The estimated demand for the cookies is 1,000,000 1-lb containers.The setup cost for each production run is $250, and the manufacturing cost is $.30 for each container of cookies.The cost of storing each container of cookies over the year is $.20. Assuming uniformity of demand throughout the year and instantaneous production, how many containers of cookies should Neilsen produce per production run in order to minimize the production cost?
Hint: Show that the total production cost is given by the function Neilsen Cookie Company sells its assorted butter cookies in containers that have a net content of 1 lb.The estimated demand for the cookies is 1,000,000 1-lb containers.The setup cost for each production run is $250, and the manufacturing cost is $.30 for each container of cookies.The cost of storing each container of cookies over the year is $.20. Assuming uniformity of demand throughout the year and instantaneous production, how many containers of cookies should Neilsen produce per production run in order to minimize the production cost? Hint: Show that the total production cost is given by the function . Then minimize the function on the interval (0, 1,000,000) . A) 50,000 B) 40,000 C) 45,000 D) 35,000 .
Then minimize the function Neilsen Cookie Company sells its assorted butter cookies in containers that have a net content of 1 lb.The estimated demand for the cookies is 1,000,000 1-lb containers.The setup cost for each production run is $250, and the manufacturing cost is $.30 for each container of cookies.The cost of storing each container of cookies over the year is $.20. Assuming uniformity of demand throughout the year and instantaneous production, how many containers of cookies should Neilsen produce per production run in order to minimize the production cost? Hint: Show that the total production cost is given by the function . Then minimize the function on the interval (0, 1,000,000) . A) 50,000 B) 40,000 C) 45,000 D) 35,000 on the interval (0, 1,000,000) .


A) 50,000
B) 40,000
C) 45,000
D) 35,000

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