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Larry's Logistics, Inc. has built a facility for cross-docking. They receive about three loads per hour. Each member of the current team of two workers makes $25 per hour, and they can transfer one truckload in about fifteen minutes. Larry pays his drivers an hourly wage of $40.
Larry is considering expanding the team by adding one more worker. He estimates that the expanded team would be able to transfer 4.2 truckloads per hour. Would this change save the firm money?
Another possibility is to hire two additional workers, and form two teams (of two people each) which would work in parallel (at the original rate). So two truckloads could be processed at the same time.
Which option would you recommend?
Support your answer with numerical analysis.
Remember to show your calculations in order to receive full credit!
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