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The manager of a large group of employees must decide whether she needs another photocopying machine. The cost of a machine is $40 per eight-hour day regardless of whether the machine is in use. On average, four people need to use the copying machine per hour. Each person uses the copier for an average of 10 minutes. Interarrival times and copying times are exponentially distributed. Employees are paid $8 per hour, and we assume that a waiting cost is incurred when a worker is waiting in line or is using the copying machine. How many copying machines should be rented assuming we want to minimize the total cost of renting and waiting?

Operation Management, Management Studies

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