Decide whether to have one or two wash lines

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The manager of a car wash must decide whether to have one or two wash lines. One line will mean a fixed cost of $5,900 a month, and two lines will mean a fixed cost of $8,850 a month. Each line would be able to process 15 cars an hour. Variable costs will be $3 per car, and revenue will be $5.95 per car. The manager projects an average demand of between 14 and 18 cars an hour. Would you recommend one or two lines? The car wash is open 260 hours a month.

Reference no: EM13844950

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