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Question: A 16-station transfer line can he divided into two stages by installing a storage buffer between stations 8 and 9. The probability of failure at any station is p = 0.01. The ideal cycle time is 1.0 min, and the downtime per line stop is 10.0 min. These values are applicable for both the one-stage and two-stage configurations. The downtime should be considered constant, and the upper-bound approach should be used in the analysis. The cost of installing the storage buffer is a function of its capacity. This cost function is Cb = $0.60b/hr = $00.01b/min, where b = the buffer capacity. However, the buffer can only be constructed to store increments of 10. (In other words, h can take on values of 10, 20, 30, etc.) The cost to operate the line itself is $120/hr. Ignore material and tooling costs. Based on cost per unit of product, determine the buffer capacity h that will minimize unit product cost.
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