Question: Consider a process consisting of three resources. Each resource is staffed by two workers. Assume the demand rate is 10 units per hour. Resource 1

Consider a process consisting of three resources. Each resource is staffed by two workers.

Assume the demand rate is 10 units per hour.

  • Resource 1 has a processing time of 10 minutes per unit.
  • Resource 2 has a processing time of 8 minutes per unit.
  • Resource 3 has a processing time of 6 minutes per unit.
  • Assume the workers are paid $20 per hour. Each unit is sold for $20 and includes parts that are sourced for $5. The company has utility cost of $10 per hour. What would be the profits per hour if they were able to reduce the processing time at the bottleneck by 20%?

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