Answered: Kitty Wonderland (KW) makes toys for…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Question

Kitty Wonderland (KW) makes toys for cats. KW’s managers have recently learned that they can calculate the average waiting time for an order from the time an order is received and the time it is manufactured. They have asked for your help and have provided the following information.

Expected number of orders for the product: 2,000
Manufacturing time per order: 4 hours
Annual machine capacity in hours: 10,000

After learning about the average waiting time, KW’s managers are confused. They do not understand why, if annual machine capacity is greater than the average number of orders for the product, there would be any waiting time at all.

Briefly answer the following questions

Calculate the average waiting time per order.
The managers have asked for your suggestions on what they can do to minimize or eliminate waiting time. How would you respond?
Management is expecting sales to increase. Will average waiting time increase or decrease? Explain briefly.

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