(Use scenario for Q6 & Q7) From now on assume that the demand is 6 customers per hour. To increase the service rate, Barbara,s Hair Salon is considering two alternatives:
Alternative I: To hire a new employee to help any one (and only one) of the servers without changing the tasks performed by each server.
Alternative II: To redesign the assignment of tasks to servers. For this, Barbara’s Hair Salon is evaluating to reassign Activity 5 from S3 to S1.
1. What would be the costs of direct labor under Alternative I (in $/guest)? Assume that we pay workers $15/hour.