One cause of the downtime in problem 3 was traced to a, Ask an Expert

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One cause of the downtime in Problem 3 was traced to a specific piece of computer hardware. Management believes that switching to a different hardware component will result in the following transition probabilities:

From	Running	To	Down
Running	0.95		0.05
Down	0.60		0.40

a. What are the steady-state probabilities of the system being in the running and down states?

b. If the cost of the system being down for any period is estimated to be $500 (including lost profits for time down and maintenance), what is the breakeven cost for the new hardware component on a time-period basis?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91591164

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