A firm has a number of semiautomatic machines that require manual loading and unloading. The automatic machine runtime is 12.5 minutes per cycle; it requires 1.25 minutes to load and 1.25 minutes to unload the machine. The time required to perform the independent operator activities is not known. However, it is known that an operator assigned four machines will be utilized (busy) 80% of the time. The cost of an operator is $10 and the cost of machine is $40 per hour.
How many machines should be assigned to an operator to minimize the cost per unit produced?
For what range of values of independent operator activity will the answer to part (a) be unchanged?
If the firm has 18 machines available for assignment, how should they be assigned to minimize the long-run cost per unit produced?