Should one or two employees handle machine repair operation

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Reference no: EM13918627

Kolkmeyer Manufacturing Company is considering adding two ma- chines to its manufacturing operation. This addition will bring the number of machines to eight. The president of Kolkmeyer asked for a study of the need to add a second employee to the repair operation. The arrival rate is 0.05 machine per hour for each machine, and the service rate for each individual assigned to the repair operation is 0.50 machine per hour.

a. Compute the operating characteristics if the company retains the single-employee repair operation.

b. Compute the operating characteristics if a second employee is added to the machine repair operation.

c. Each employee is paid $20 per hour. Machine downtime is valued at $80 per hour. From an economic point of view, should one or two employees handle the machine repair operation? Explain.

Reference no: EM13918627

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