IND ENG 130 Midterm: ieor130-sp2010-mt1-Leachman-exam
8 Jan 2019
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20 points each problem, 60 points total: a fabrication plant includes a sophisticated etching machine purchased almost a year ago. The purchase agreement for the machine included a service contract lasting one year whereby technicians working for the machine vendor perform preventative maintenance and repairs on the machine. At present, a machine vendor"s technician performs a weekly pm. The pm takes the machine down for 4 hours. When the machine breaks down, the down time averages 8 hours (including time for the technician to drive to the plant). Data on machine failures indicates that the time until failure from performance of pm is distributed as follows: The machine vendor offers to renew the service contract for one year at a fixed cost of ,000. Alternatively, the plant could hire a local, on-call independent contractor charging per hour to perform pms or repairs. This contractor used to work for the vendor and is very knowledgeable about the machine.
