Consider a process consisting of three resources; each resource is staffed by one worker.

Resource #1 has a processing time of 5 minutes per unit.

Resource #2 has a processing time of 4 minutes per unit.

Resource #3 has a processing time of 2 minutes per unit.

Assume each worker gets paid $12 an hour. Each unit is sold for $6 and includes parts that are sourced for $1 which is the variable cost. The company has fixed costs of $10 per hour. Demand rate is assumed as 13 units per hour.

Which option is the best in terms of the profit per hour? (Calculate the profit of each option to choose the best one.)

Option #1: 10% lower material costs (15/100)

Option #2: 10% lower fixed costs (15/100)

Option #3: 10% faster at bottleneck (15/100)