Use This Information to Answer the Following Questions

question 15

Essay

Use this information to answer the following questions.
A small suburban post office is frequented by customers at the rate of 15 per hour.The post office has a single employee who typically processes each customer's request at an average rate of 3 minutes per transaction.Assume that arrival rate follows a Poisson distribution and service time follows an exponential distribution.
-Refer to the information above.The postmaster has been receiving complaints from customers about long waiting times.The postmaster is considering hiring an additional employee who will also be able to process each customer's request at the same rate of 3 minutes per transaction.Assume that the post office pays its employees $12 per hour and that the cost of customer waiting time,in terms of customer dissatisfaction and goodwill,is $10 per hour.Assume that arrival rate follows a Poisson distribution and service time follows an exponential distribution.Should the postmaster hire an additional employee? Compare the total costs of this two-employee system with the old single-server queuing system.

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Definitions:

Interest

The charge for borrowing money or the return on invested capital, usually expressed as an annual percentage rate.

Interest Rate

The fraction of a borrowed sum that incurs interest charges for the borrower, often expressed in terms of a yearly percentage.

Investment

The process of assigning financial resources with the goal of making a profit or gaining income.

Interest

The amount paid for the use of borrowed money, typically expressed as a percentage.