Iron Hill Pallet Company produces hardwood mulch by grinding used pallets. The company’s grinder can produce 11 cubic yards of m
ulch per hour and operates the grinder 24 hours per day for 250 days per year. The annual demand for mulch is 40,000 cubic yards. It costs Iron Hill $200 to setup the grinder for production. It costs iron hill $20 to produce a cubic yard of mulch, and they use a factor of 10% to calculate the inventory holding cost. Calculate the economic production quantity for mulch.