The cost of this equipment would be about 500 per day is


Carlos Gomez is the receiving supervisor for a large grocery store. Trucks arrive to the loading dock at an average rate of four per hour, according to a Poisson distribution, for 8 hours each day. The cost of operating a truck is estimated to be $80 per hour. Trucks are met by a three person crew,which is able to unload a truck in the average of 12 mins, according to expotential distribution. They payroll cost associated with hiring a crew member, included benefits, is $22 per hour. Carlos is now considering the installation of new equipment which would decrease the average unloading time from 12 minutes to 9 minutes. The cost of this equipment would be about $500 per day. Is the installation of the new equipment economially feasible.

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Operation Management: The cost of this equipment would be about 500 per day is
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