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A company has a central document copying service. With the present copy machines, the average time for making copies is 3 minutes. A new machine
A company has a central document copying service. With the present copy machines, the average time for making copies is 3 minutes. A new machine reduces the copy time to 2 minutes on average. The new machine would cost 10$ per hour to rent more than the present machine. The average wage of the company employees that make copies is 7.5$ an hour. Is the new machine worth the 10$ more rent? To answer this question, answer the following questions: a.) What do you need to estimate in order to answer this question? b.) The demand for the copy services is: 15 employees seek to make copies per hour. The employees come to the copy machine with a negative exponential probability. The time it takes to copy is also negative exponentially distributed. What is the average time the employees spend presently at the copy machine including waiting time (hint: the formula for the average time is W: 1 / (capacity per hour - demand per hour). c.) What is the average time employees would spend at the copy service including waiting with the new machine? d) That is the labor cost the company would save with the time reduction per employee? e) How many employees want to make copies in an hour and what is the total labor cost saving? f) Does the cost savings justify the additional rent for the new machine
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