Larry Ellison starts a company that manufacturers high-end custom leather bags.
ID: 340224 • Letter: L
Question
Larry Ellison starts a company that manufacturers high-end custom leather bags. He hires two employees. Each employee only begins working on a bag when a customer order has been received and then she makes the bag from beginning to end. The average production time of a bag is 1.6 days with a standard deviation of 8 days. Larry expects to receive one customer order per day on average. The interarrival times of orders have a coefficient of variation of 1.
What is the expected duration, in days, between when an order is received and when production begins on the bag?
Explanation / Answer
Given data
The average production time of a bag T= 1.6 days
standard deviation s= 8 days
order = 1 cust /day
expected duration=s/T =8/1.6 =5 days
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