Assuming current costs are held constant

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Reference no: EM13970629

An auto-rental agency has two employees at its service counter. Customers arrive at an average rate of 18 per hour. The service times mean a service rate of 15 customers per hour. The coefficients of variation of the inter-arrival times and the service times are both equal to 1.

a. What are the appropriate measures of service for this facility?

b. Each additional customer gives the agency $15 in additional contribution (assuming current costs are held constant). If the average waiting time overall could be reduced 75%, two more customers per hour would be drawn from competing auto-rental agencies. Should additional employees be hired for $12 an hour?

Reference no: EM13970629

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