Use the attached to answer the follwoing questions. 1. Assume RentAphone could buy additional phones for $500 a piece. Is it worht buying one additional phone? justify your answer. 2. How would waiting time change if the company decides to limit all rentals to exactly 72 hours? Assume that if such a stetiction is imposed, the number of customers requesting a phone would b reduce to 20 customers per day. Enter the new waiting time in hours.
Use the attached to answer the follwoing questions. 1. Assume RentAphone could buy additional phones for $500 a piece. Is it worht buying one additional phone? justify your answer. 2. How would waiting time change if the company decides to limit all rentals to exactly 72 hours? Assume that if such a stetiction is imposed, the number of customers requesting a phone would b reduce to 20 customers per day. Enter the new waiting time in hours.
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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Use the attached to answer the follwoing questions.
1. Assume RentAphone could buy additional phones for $500 a piece. Is it worht buying one additional phone? justify your answer.
2. How would waiting time change if the company decides to limit all rentals to exactly 72 hours? Assume that if such a stetiction is imposed, the number of customers requesting a phone would b reduce to 20 customers per day. Enter the new waiting time in hours.
Transcribed Image Text:Problem 2:
RentAPhone is a new service company that provides European mobile phones to American
visitors to Europe. The company currently has 80 phones available at Charles de Gaulle Airport
in Paris. There are, on average, 25 customers per day requesting a phone. These requests arrive
uniformly throughout the 24 hours the store is open. The corresponding coefficient of variation
is 1. Customers keep their phone on average 72 hours. The standard deviation of this time is
100 hours. Given that RentAPhone currently does not have a competitor in France providing
equally good service, customers are willing to wait for the phones. Yet, during the waiting
period, customers are provided a free calling card. Based on prior experience, RentAphone
found that the company incurred a cost of $1 per hour per waiting customer, independent of
day or night.
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