Question
A warehouse has 2 loading bays at which trucks arrive unscheduled, at an average rate of 0.6 trucks per hour, to deliver goods. If there
A warehouse has 2 loading bays at which trucks arrive unscheduled, at an average rate of 0.6 trucks per hour, to deliver goods. If there are more than 2 trucks at the warehouse at any time, the 3rd, 4Th and subsequent trucks must wait for loading since there are only 2 loading bays. This congestion is inefficient and to alleviate it, the warehouse manager is considering two options (a) building a 3Rd loading bay at a cost of $325,000, or (b) purchasing mechanized loading equipment for$245,000 to speed up the loading of the truck. At present the warehouse uses trucks that take 2 hours to load. The manager decides to build the 3rd loading bay if the probability of more than 2 trucks arriving during the 2 hour loading period is greater than 10%. Should the 3rd loading bay be built? State your reasons clearly.
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