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Course: Quantitative Techniques Code: MTS-601 Mba-R/Ms SPRING 2021-E-H

This document discusses Arnold's muffler shop queuing system and costs. It analyzes the current system with one mechanic servicing 2 arrivals per hour. The total daily cost is calculated to be $653.33. It then analyzes a potential new system with a faster mechanic servicing 4 arrivals per hour. With the new system, the average wait time decreases and total daily cost decreases to $360, providing a potential daily savings of $293.33.

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Waqar Ahmad
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40 views9 pages

Course: Quantitative Techniques Code: MTS-601 Mba-R/Ms SPRING 2021-E-H

This document discusses Arnold's muffler shop queuing system and costs. It analyzes the current system with one mechanic servicing 2 arrivals per hour. The total daily cost is calculated to be $653.33. It then analyzes a potential new system with a faster mechanic servicing 4 arrivals per hour. With the new system, the average wait time decreases and total daily cost decreases to $360, providing a potential daily savings of $293.33.

Uploaded by

Waqar Ahmad
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 9

Course: Quantitative Techniques

Code: MTS-601
MBA-R/MS
SPRING 2021-E-H

Dr. Abdul Kabeer Kazi


Dean, FMS
[email protected]
021-34314970, Ext. 338
Arnold’s Muffler Shop
 Introducing costs into the model:
 Arnold wants to do an economic analysis of
the queuing system and determine the waiting
cost and service cost.
 The total service cost is:

Total (Number of channels)


=
service cost x (Cost per channel)
Total
service cost = mCs

13-2
Arnold’s Muffler Shop
Waiting cost when the cost is based on time in the
system:
Total (Total time spent waiting by all
=
waiting cost arrivals) x (Cost of waiting)
(Number of arrivals) x
=
(Average wait per arrival)Cw
Total
waiting cost = (W)Cw
If waiting time cost is based on time in the queue:
Total
waiting cost = (Wq)Cw

13-3
Arnold’s Muffler Shop

So the total cost of the queuing system when based


on time in the system is:

Total cost = Total service cost + Total waiting cost


Total cost = mCs + WCw

And when based on time in the queue:

Total cost = mCs + WqCw

13-4
Arnold’s Muffler Shop
 Arnold estimates the cost of customer waiting
time in line is $50 per hour.
Total daily
waiting cost = (8 hours per day)WqCw
= (8)(2)(2/3)($50) = $533.33
 Arnold has identified the mechanics wage $7 per
hour as the service cost.
Total daily
service cost = (8 hours per day)mCs
= (8)(1)($15) = $120
 So the total cost of the system is:
Total daily cost of
the queuing system = $533.33 + $120 = $653.33
13-5
Arnold’s Muffler Shop
 Arnold is thinking about hiring a different
mechanic who can install mufflers at a faster rate.
 The new operating characteristics would be:
 = 2 cars arriving per hour
 = 4 cars serviced per hour

 2 2
L    1 car in the system
  42 2 on the average

1 1
W    1/2 hour that an average car
  42 spends in the system

13-6
Arnold’s Muffler Shop

2 22 4
Lq     1/2 car waiting in line
 (    ) 4( 4  2) 8(1) on the average
 1
Wq   hour  15 minutes average
(   ) 4 waiting time per car
 2
    0 .5  percentage of time
 4 mechanic is busy
 2
P0  1   1   0.5  probability that there
 4 are 0 cars in the system

13-7
Arnold’s Muffler Shop Case
 The customer waiting cost is the same $50 per
hour:
Total daily
waiting cost = (8 hours per day)WqCw
= (8)(2)(1/4)($50) = $200.00
 The new mechanic is more expensive at $20 per
hour:
Total daily
service cost = (8 hours per day)mCs
= (8)(1)($20) = $160
 So the total cost of the system is:
Total daily cost of
the queuing system = $200 + $160 = $360
13-8
Arnold’s Muffler Shop

 The total time spent waiting for the 16 customers


per day was formerly:
(16 cars per day) x (2/3 hour per car) = 10.67 hours
 It is now is now:

(16 cars per day) x (1/4 hour per car) = 4 hours


 The total daily system costs are less with the new
mechanic resulting in significant savings:
$653.33 – $360 = $293.33

13-9

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