1.

Arnold’s mechanic, Reid Blank, is able to install new mufflers at an average rate of three per
hour, or about one every 20 minutes. Customers needing this service arrive at the shop on the
average of two per hour.

λ = 2 cars arriving per hour

µ = 3 cars serviced per hour

Compute the following:

a. L
b. W
c. Lq
d. W q
e. ρ
f. P0
g. chance that more than 3 cars are in the system.

2. Arnold estimates that the cost of customer waiting time, in terms of customer dissatisfaction and
lost goodwill, is $50/hour of time spent waiting in line and service cost is $15/hour. In 8 hours
per shift.
Compute the following;
a. Total service cost (per hour and per shift)
b. Total waiting cost (per hour and per shift)
c. Total cost

3. Arnold finds out through the muffler business grapevine that the Rusty Muffler, a cross-town
competitor, employs a mechanic named Jimmy Smith who can efficiently install new mufflers at
the rate of four per hour. Larry Arnold contacts Smith and inquires as to his interest in switching
employers. Smith says that he would consider leaving the Rusty Muffler but only if he were paid
a $20 per hour salary. Arnold, being a crafty businessman, decides that it may be worthwhile to
fire Blank and replace him with the speedier but more expensive Smith.

λ = 2 cars arriving per hour

µ = 4 cars serviced per hour

How much does the two mechanics' total cost differerence?