The Insurance Department at Shear's Has Two Agents,each Working at a Mean

question 9

Essay

The insurance department at Shear's has two agents,each working at a mean speed of eight customers per hour.Customers arrive at the insurance desk at a mean rate of one every six minutes and form a single queue.Management feels that some customers are going to find the wait at the desk too long and take their business to Word's,Shear's competitor.​
In order to reduce the time required by an agent to serve a customer,Shear's is contemplating installing one of two minicomputer systems: System A that leases for $18 per day and will increase an agent's efficiency by 25% or System B that leases for $23 per day and will increase an agent's efficiency by 50%.Agents work eight-hour days.​
If Shear's estimates its cost of having a customer in the system at $3 per hour,determine if it should install a new minicomputer system,and if so,which one?

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Definitions:

Industrial Production

The total output of a country's manufacturing, mining, and utilities segments.

United States

A country in North America, comprising 50 states, a federal district, five major self-governing territories, and various possessions.

Germany

A country in Central Europe, known for its rich history, culture, and significant contributions to the fields of science, technology, and economy.

Import Substitution

An economic strategy aimed at reducing foreign dependency by local production of industrialized products.