BB&K Groceries is opening a new store boasting state-of-the-art check-out scanners. Mr. Bih, one of the owners
Question:
BB&K Groceries is opening a new store boasting “state-of-the-art” check-out scanners. Mr. Bih, one of the owners of B&K, has limited the choices to two scanners:
scanner A can process 15 items a minute, and the better-quality scanner B can scan 20 items a minute. The daily (10 hours) cost of operating and maintaining the scanners are $30 and $50 for models A and B, respectively. Customers who finish shopping arrive at the cashier according to a Poisson distribution at the rate of 10 customers per hour. Each customer’s cart carries between 25 and 35 items, uniformly distributed.
Mr. Bih estimates the average cost per waiting customer per minute to be about 20 cents. Which scanner should B&K acquire? (Hint: The service time per customer is not exponential. It is uniformly distributed.)
Step by Step Answer: