Illustrate what is the average number of people in line., Ask an Expert

Management Studies

Q. Karen Brown's Coffee Shop decides to install an automatic coffee vending machine outside one of its stores to reduce the number of people standing in line inside. Karen charges $3.50 per cup. Explain however, it takes too long for people to make change. The service time is a constant 3 min. and the arrival rate is 15 per hour (Poisson distributed).

A) Illustrate what is the average wait in line?

B) Illustrate what is the average number of people in line?

C) Karen raises the price to $5 per cup and takes 60 seconds off the service time. Explain however, because the coffee is now so expensive, the arrival rate drops to 10 per hour. Now illustrate what are the average wait time and average number of people in the queue (waiting)?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M9309198

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