The number of cases per batch that the manufacturer should produce to minimize cost is 462 cases per batch.
To minimize inventory costs, especially setup and holding costs, the economic order quantity (EOQ) technique is deployed.
The EOQ model refers to the ideal order or batch quantity a company should purchase per order or produce per batch to minimize its inventory costs.
Some of a company's inventory costs include holding costs, shortage costs, setup, and ordering costs.
Using the EOQ model shows the ideal minimum units that the manufacturer should produce per batch to minimize costs.
The EOQ formula is square root of: [2(setup costs)(demand rate)] / holding costs.
Annual demand = 22,638 cases
Storage cost per case = $7
Setup cost per batch = $33
Product unit cost = $15 per case
EOQ = square root of: [2(setup costs)(demand rate)] / holding costs.
= square root of 2 x $33 x 22,638/$7
= square root of 213,444
= 462
Number of batches = 49 (22,638/462)
Thus, the number of cases per batch that the manufacturer should produce to minimize cost is 462 cases per batch.
Learn more about the EOQ model at https://brainly.com/question/17350373
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