Prince Shop. owns and operates a chain of popular coffee stands that serve over 30 different coffee-based beverages. The constraint at the coffee stands is the amount of time required to fill an order, which can be considerable for the more complex beverages. Sales are often lost because customers leave after seeing a long waiting line to place an order. Careful analysis of the company's existing products has revealed that the opportunity cost of order- filling time is P34.00 per minute. The company is considering introducing a cappuccino, to be made with almond extract and double-fine sugar. The variable cost of the' standard size amaretto cappuccino would he P4 60 and new product, amaretto

Prince Shop. owns and operates a chain of popular coffee stands that serve over 30 different coffee-based beverages. The constraint at the coffee stands is the amount of time required to fill an order, which can be considerable for the more complex beverages. Sales are often lost because customers leave after seeing a long waiting line to place an order. Careful analysis of the company's existing products has revealed that the opportunity cost of order- filling time is P34.00 per minute. The company is considering introducing a cappuccino, to be made with almond extract and double-fine sugar. The variable cost of the' standard size amaretto cappuccino would he P4 60 and new product, amaretto

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter12: Queueing Models

Section: Chapter Questions

Problem 59P

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OVERBOOKED: FRONT OFFICE PERSPECTIVE Overbooking is an accepted hotel and airline practice. Many questionthe practice from various standpoints, including ethical and moral.Industry executives, however, argue that there is nothing moreperishable than a vacant room. If it is not used, there is no chance toregain lost revenue. Hotels need to protect themselves becausepotential guests frequently make reservations at more than one hotelor are delayed and, therefore, do not show up. The percentage of no-shows varies by hotel and location but is often around five percent. In a 400-room hotel, that is 20 rooms, or an average loss ofapproximately $2,600 per night. Considering these figures, it is notsurprising that hotels try to protect themselves by overbooking.Hotels look carefully at bookings: Whom they are for, what rates theyare paying, when they were made, whether they are for regular guestsor from a major account (a corporation that uses the hotel frequently),and so on. Jill Reynolds,…
Jeruk Pak Abu’s Store in Butterworth, Pulau Pinang, maintains a successfulcatalog sales department in which a clerk takes orders by telephone. If the clerk isoccupied on one line, incoming phone calls to the catalog department areanswered automatically by a recording machine and asked to wait. As soon as theclerk is free, the party who has waited the longest is transferred and serviced first.Calls come in at a rate of about 12 per hour. The clerk can take an order in anaverage of 4 minutes. Calls tend to follow a Poisson distribution, and servicetimes tend to be negative exponential. The cost of the clerk is RM10 per hour, butbecause of lost good –will and sales, Jeruk Pak Abu’s Store loses about RM25 perhour of customer time spent waiting for the clerk to take an order. a) Prepare the total cost for this waiting line system.
Jeruk Pak Abu’s Store in Butterworth, Pulau Pinang, maintains a successfulcatalog sales department in which a clerk takes orders by telephone. If the clerk isoccupied on one line, incoming phone calls to the catalog department areanswered automatically by a recording machine and asked to wait. As soon as theclerk is free, the party who has waited the longest is transferred and serviced first.Calls come in at a rate of about 12 per hour. The clerk can take an order in anaverage of 4 minutes. Calls tend to follow a Poisson distribution, and servicetimes tend to be negative exponential. The cost of the clerk is RM10 per hour, butbecause of lost good –will and sales, Jeruk Pak Abu’s Store loses about RM25 perhour of customer time spent waiting for the clerk to take an order a.Prepare the total cost for this waiting line system.
Jeruk Pak Abu’s Store in Butterworth, Pulau Pinang, maintains a successfulcatalog sales department in which a clerk takes orders by telephone. If the clerk isoccupied on one line, incoming phone calls to the catalog department areanswered automatically by a recording machine and asked to wait. As soon as theclerk is free, the party who has waited the longest is transferred and serviced first.Calls come in at a rate of about 12 per hour. The clerk can take an order in anaverage of 4 minutes. Calls tend to follow a Poisson distribution, and servicetimes tend to be negative exponential. The cost of the clerk is RM10 per hour, butbecause of lost good –will and sales, Jeruk Pak Abu’s Store loses about RM25 perhour of customer time spent waiting for the clerk to take an order. a) Compute the average time that customers must wait before their calls are transferred to the clerk.
Jeruk Pak Abu’s Store in Butterworth, Pulau Pinang, maintains a successfulcatalog sales department in which a clerk takes orders by telephone. If the clerk isoccupied on one line, incoming phone calls to the catalog department areanswered automatically by a recording machine and asked to wait. As soon as theclerk is free, the party who has waited the longest is transferred and serviced first.Calls come in at a rate of about 12 per hour. The clerk can take an order in anaverage of 4 minutes. Calls tend to follow a Poisson distribution, and servicetimes tend to be negative exponential. The cost of the clerk is RM10 per hour, butbecause of lost good –will and sales, Jeruk Pak Abu’s Store loses about RM25 perhour of customer time spent waiting for the clerk to take an order. a.What is the suitable method to solve this problem? b.Compute the average time that customers must wait before their calls aretransferred to the clerk.
Jeruk Pak Abu’s Store in Butterworth, Pulau Pinang, maintains a successfulcatalog sales department in which a clerk takes orders by telephone. If the clerk isoccupied on one line, incoming phone calls to the catalog department areanswered automatically by a recording machine and asked to wait. As soon as theclerk is free, the party who has waited the longest is transferred and serviced first.Calls come in at a rate of about 12 per hour. The clerk can take an order in anaverage of 4 minutes. Calls tend to follow a Poisson distribution, and servicetimes tend to be negative exponential. The cost of the clerk is RM10 per hour, butbecause of lost good –will and sales, Jeruk Pak Abu’s Store loses about RM25 perhour of customer time spent waiting for the clerk to take an order. a.What is the suitable method to solve this problem? b.Compute the average time that customers must wait before their calls aretransferred to the clerk. c.Prepare the total cost for this waiting line system.
Seattle's Top Coffee owns and operates a chain of popular coffee stands that serve over 30 different coffee-based beverages. The constraint at the coffee stands is the amount of time required to fill an order, which can be considerable for the more complex beverages. Sales are often lost because customers leave after seeing a long waiting line to place an order. Careful analysis of the company's existing products has revealed that the opportunity cost of order filling time is $2.70 per minute. The company is considering introducing a new product, praline cappuccino, to be made with pecan extract and molasses. The variable cost of the standard size praline cappuccino would be $0.30 and the time required to fill an order for the beverage would be 40 seconds Required: What is the minimum acceptable selling price for the new praline cappuccino product?
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.
Jeruk Pak Abu’s Store in Butterworth, Pulau Pinang, maintains a successful catalog sales department in which a clerk takes orders by telephone. If the clerk is occupied on one line, incoming phone calls to the catalog department are answered automatically by a recording machine and asked to wait. As soon as the clerk is free, the party who has waited the longest is transferred and serviced first. Calls come in at a rate of about 12 per hour. The clerk can take an order in an average of 4 minutes. Calls tend to follow a Poisson distribution, and service times tend to be negative exponential. The cost of the clerk is RM10 per hour, but because of lost good –will and sales, Jeruk Pak Abu’s Store loses about RM25 per hour of customer time spent waiting for the clerk to take an order. 1. What is the suitable method to solve this problem? 2. Compute the average time that customers must wait before their calls are transferred to the clerk. 3. Prepare the total cost for this waiting line…
Jeruk Pak Abu's Store in Butterworth, Pulau Pinang, maintains a successful catalog sales department in which a clerk takes orders by telephone. If the clerk is occupied on one line, incoming phone calls to the catalog department are answered automatically by a recording machine and asked to wait. As soon as the clerk is free, the party who has waited the longest is transferred and serviced first. Calls come in at a rate of about 12 per hour. The clerk can take an order in an average of 4 minutes. Calls tend to follow a Paisson distribution, and service times tend to be negative exponential. The cost of the clerk is RM10 per bour, but because of lost good -will and sales, Jeruk Pak Abu's Store loses about RM25 per hour of customer time spent waiting for the clerk to take an order. iii) Prepare the total cost for this waiting line system.
The question comes out of my "Practical Operations Management's" textbook. Tube Country rents circular rubber rafts that its customers use to float down the Ichituckni River. Tube Country owns a fleet of 200 rafts, each of which is returned on the same day it is rented, and each raft can only be rented once during a business day. Rough water along the Ichituckni River often causes rafts to become scratched and leak air, so the staff at Tube Country is constantly repairing rafts before their next rental. As a result, Tube Country estimates that 5% of its rental fleet is unavailable for rent at any given time. Tube Country rents rafts for $5 each, and incurs $1.00 in variable costs with each raft rental. Tube Country must also pay $20,000 in fixed business costs annually. What is the daily effective capacity of Tube Country’s fleet? The issue of rough water creating the need for continual repairs can best be described as what? Suppose Tube Country rents 100 rafts on a certain day.…
The question comes out of my "Practical Operations Management's" textbook. Tube Country rents circular rubber rafts that its customers use to float down the Ichituckni River. Tube Country owns a fleet of 200 rafts, each of which is returned on the same day it is rented, and each raft can only be rented once during a business day. Rough water along the Ichituckni River often causes rafts to become scratched and leak air, so the staff at Tube Country is constantly repairing rafts before their next rental. As a result, Tube Country estimates that 5% of its rental fleet is unavailable for rent at any given time. Tube Country rents rafts for $5 each, and incurs $1.00 in variable costs with each raft rental. Tube Country must also pay $20,000 in fixed business costs annually. How many rentals does Tube Country need to break even each year? How many rentals does Tube Country need to make in a year to earn $5,000 in profit? Last year, the owner of Tube Country, Mr. Robert “Bobber” Gowdy, had…