Reference no: EM131929840

Question: Zodiac Chemical manufactures chlorine gas by passing electricity through saltwater in a diaphragm cell. The plant has 88 diaphragm cells that operate in parallel. Each cell can produce 5 tons of chlorine gas per day, and each ton of chlorine gas has a profit contribution of $15. Due to the harsh environment, cell failures occur, causing the cell to be taken offline for maintenance. A cell fails, on average, every 30 hours, according to the exponential probability distribution. Only one cell can be repaired at any given time. Using the current maintenance procedure, the repair time follows a truncated normal probability distribution, with a mean of 21 hours, a standard deviation of 6 hours, and a minimum value of 5 hours. A new maintenance procedure is being considered that will require a significant capital investment. If this new procedure is implemented, the repair time will still follow a truncated normal distribution, but the mean time will be 14 hours, the standard deviation will be 4 hours, and the minimum time will be 3 hours. Simulate 200 failures to determine the annual savings in downtime with the new method.