The manager of a car wash has to decide whether to have one, Ask an Expert

Management Studies

The manager of a car wash has to decide whether to have one or two carwash lines. Foe one line the fixed cost will be $ 6,000 per month, and the fixed cost for two lines will be $ 10,500 per month. Each line will be able to process 15 cars per hour. The variable costs will be $ 3 per car, and the revenue per car is estimated to be $ 5.95.

The manager projects that the average service demand will be between 14 and 18 cars per hour. The car wash will be open 300 days every year.

Would you recommend one or two lines?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91575234

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