Verizon wireless has been analyzing the incoming calls on their customer service line. All calls go to the same phone number and they are distributed to the first available customer service rep. On average 80 calls are received per hour. On average it takes a customer service rep 6 minutes to service a call. There are currently 9 customer service reps. The reps are paid $18 / hr. Verizon estimates that customer frustration and switching costs are directly related to time waiting and have estimated those costs to be $100/hr.

Please prepare the following:

a.) What is the total cost of the current system including both labor costs and waiting costs?

b.) What is the utilization of the average worker under the current system?

c.) If Verizon wanted to minimize total cost, what is the optimal # of customer service reps they should employ? PLEASE SHOW ALL WORK FOR THIS.

d.) What would the utilization of the average worker be for the optimal solution you found in part “c” be?