Is installation of the new equipment economically feasible

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Reference no: EM131930322

Question: Carlos Gomez is the receiving supervisor for a large grocery store. Trucks arrive to the loading dock at an average rate of four per hour, according to a Poisson distribution, for 8 hours each day. The cost of operating a truck is estimated to be $80 per hour. Trucks are met by a three-person crew, which is able to unload a truck in an average of 12 minutes, according to an exponential distribution. The payroll cost associated with hiring a crew member, including benefits, is $22 per hour. Carlos is now considering the installation of new equipment to help the crew, which would decrease the average unloading time from 12 minutes to 9 minutes. The cost of this equipment would be about $500 per day. Is the installation of the new equipment economically feasible?

Reference no: EM131930322

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