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Question
A crew of mechanics at the Highway Department garage repair vehicles that break down at an average of u03bb = 8 vehicles per day (approximately Poisson in nature). The mechanic crew can service an average of u03bc= 11 vehicles per day with a repair time distribution that approximates an exponential distribution. The crew cost is approximately $300 per day. The cost associated with lost productivity from the breakdown is estimated at $150 per vehicle per day (or any fraction thereof). Which is cheaper, the existing system with one service crew, or a revised system with two service crews?
Answer
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