Question

Problem 3: The number of breakdowns of a system for the past 30 months is given in the table below. Each breakdown costs 500 dollars. Instead if an outside company does preventive maintenance on the system, the breakdowns reduce to 2 per month. This outside company charges 500 dollars per month for their service. Shall we contract out to them or not? # of breakdowns # of months that breakdowns occurred 0 6 2 3 4 5 5 5 3 1 2 9

Answer 1

Solo for decidi deciding that we have to contract the company Of not We have to compare the data for past 30 months. Case I: Per damage Repairing (no conpack) Cost of Reparining each break down $500 / Breakdown. estimating total number of damage from the table in these 30 months. .". Total number of damage in 30 months N = 0x3 +1x6+242 + 349 +48 5 + 5x5 N = 82 breakdown the breakdown => ... Total text of Repowing T.C; cost of Repairing Each breakdventh breytown ҳ Pofal number breakdown in these bo months > $500 x 82 Breakdown T-C,= $ 41000 Case I Contract Presention and Repaising =2 Bregledown/month Total numbes breakdown per month after premestive maintainance of breakdown in 30 2x305 Go Breakdowns, Total number months.

Cost preventive maintainance per month - $ 500 /month - Total cost Total cost of repainting and maintainance for 30 months. TEC - Total number of pressen time maintainanu breakdown each Breakdown ) cost of Reparining cost Maintainance 30* $ 500 + 2X30X8500 90 x $500 T.CZ: $ 45000 TC, <I C2 any i. We should not contract them for maintainance and the and the flexibility preventive plecoility operation also decseaned

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