The Schmedley Discount Department Store has approximately 300 customers shopping in its store between 9 A.M. and 5 P.M. on Saturdays. In deciding how many cash registers to keep open each Saturday, Schmedleys manager considers two factors: customer waiting time (and the associated waiting cost) and the service costs of employing additional checkout clerks. Checkout clerks are paid an average of $8 per hour. When only one is on duty, the waiting time per customer is about 10 minutes (or hour); when two clerks are on duty, the average checkout time is 6 minutes per person; 4 minutes when three clerks are working; and 3 minutes when four clerks are on duty. Schmedleys management has conducted customer satisfaction surveys and has been able to estimate that the store suffers approximately $10 in lost sales and goodwill for every hour of customer time spent waiting in checkout lines.

Number of customers Average waiting time (per customer) Total customer waiting time Cost per waiting hour Total waiting cost Checkout clerk hourly salary Total pay of clerks for an 8-hour shift Total expected cost