An aircraft repair service reimburses its customers for the time that an aircraft spends at their...

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Operations Management

An aircraft repair service reimburses its customers for the timethat an aircraft spends at their facility. Total costs are the sumof these reimbursements (waiting costs) and the salaries of theirtechnicians. A customer is reimbursed $203 per hour for the timethat the aircraft is out of service, and the cost of a servicetechnician (including equipment and materials) is $1,196 per hour.Use Table 1 and Table 2. a. How many service technicians should beon call, if there are (on average) 4 aircraft arriving per hour,and each technician can complete 5 services per hour (Poissondistributions)? HINT: Calculate the total cost, which is the sum ofwaiting cost and service cost. Number of technician(s) b. Theservice rate could be made faster ( (5.71 repairs per hour) if thecompany invests in new software, which would cost $100 per servicetechnician. Is it cost-effective for the company to invest in thissoftware? HINT: the service cost is higher, but the time that ittakes to get through the system, hence the waiting cost, is lower.(Round your cost amount to 2 decimal places and all othercalculations to 3 decimal places. Omit the \"$\" sign in yourresponse.) , because the daily total cost with the new software is$ which is lower than without the new software.

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3.8 Ratings (675 Votes)
Arrival rate 4 per hourService rate 5 per hour 45 08Waiting cost Cw 203 per hourService cost Cs 1196 per houraRefer the following table and look up 08For M 1 Value of Lq 32 where M is the number of servicetechniciansL Lq 3208    See Answer
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