Question
Sunray Electric Coop uses a fleet of 20 trucks to service its electric network. The company wants to develop a preventive maintenance schedule for the
Sunray Electric Coop uses a fleet of 20 trucks to service its electric network. The company wants to develop a preventive maintenance schedule for the fleet. The probability of a breakdown in year 1 is zero. For year 2, the breakdown probability is .03, increasing annually by .01 for years 3 through 10. Beyond year 10, the breakdown probability remains constant at .13. The cost per truck is $200 for a random breakdown and $75 for a preventive maintenance.
(a) Develop the associated decision tree.
(b) Determine the optimal period (in years) between successive preventive maintenances.
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