home security service. This private home security service guarantees to either dispatch one of their own five guards immediately if one of their customers sends in an alarm or, in the case that all five guards are responding to other calls, direct the alarm to the local police. The company receives 12 calls per hour, evenly distributed over the course of the day. The local police charges the home security company $500 for every call that the police responds to. It takes a guard, on average, 90 minutes to respond to an alarm. a. What fraction of the time are incoming alarms directed to the police? b. How much does the home security company have to pay the local police every month?

a.

The fraction of the time is incoming alarms directed to the police is 74.02%

b.

The home security company has to pay $3,197,665 the local police every month.

Step-by-step explanation:

As per the given data

Numbers of guards = 5 guards

Calls received per hour = 12 calls per hour

Activity time = 90 minutes

First, calculate the inter-arrival time

Inter-arrival time = Minutes in an hour / Numbers of calls received per hour = 60 minutes per hour / 12 calls per hour = 5 minutes

a.

First, calculate the ratio of activity time to inter-arrival time

Ratio = Activity time / Inter-arrival time = 90 minutes / 5 minutses = 18

Now calculate the probability of all 5 servers are busy using ratio of activity time to inter-arrival time

Probability = ( ratio )

Probability = ( 18 )

Probability = 0.7402

Probability = 74.02%

Hence the probability of incoming calls directed to the police is 74.02%

b.

First, calculate the loss of customers

Loss of customers = Probability x ( 1 / Servers )

Loss of customers = 74.02% x ( 1 / 5 )

Loss of customers = 0.7402 x 0.20

Loss of customers = 0.14804 per minute

Loss of customers = 0.14804 per minute x 24 x 60 x 30 = 6,395.33 calls per month

Now calculate the total loss

Total loss =  6,395.33 calls x $500

Total loss = $3,197,665

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