Question

A company’s machines break down according to a Poisson process at a mean rate of 3 per hour. Nonproductive time on any machine costs the company $60 per hour. The company employs a maintenance person who repairs machines at a mean rate of μ machines per hour (when continuously busy) if the company pays that person a wage of $5μ per hour. The repair time has an exponential distribution.
Determine the hourly wage that minimizes the company’s total expected cost.


$1.99
Sales0
Views162
Comments0
  • CreatedSeptember 22, 2015
  • Files Included
Post your question
5000