Which scenario gives the lowest unit cost

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Reference no: EM131868263

Question: The Dorben Co. assigns one worker to service four machines, each of which has a probability of going down 40% of the time.

a) Calculate the % machine time that is lost.

b) The Dorben Co. decides to assign two workers to service the four machines. This is very atypical, but was done because of the random nature and the high probability that the machines may go down (p=.4). Calculate the % machine time that is lost (i.e. the machine is not running and is not being serviced) for two strategies:

1) Each operator picks and stays with 2 machines or

2) Each helps the other out. Which is better?

c) Now consider cost. Assume that workers are paid $10.00/hr , machines cost $50.00/hr and can produce 60 units/hr if running. Which scenario gives the lowest unit cost (i.e. one worker, two workers with the two different strategies)?

Reference no: EM131868263

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