A bank has its head office in the financial district in the middle of a city. A bank has six branches, three in the north of the city and three in the south all 5 km from the centre and spaced 3 km apart. The bank wishes to link all its branches via private leased lines but must decide between providing an individual line to each branch  via a number of inter-branch links and a smaller number of multiplexed lines to the centre. If a modem costs £100, a multiplexer/demultiplexer costs £200 and leased lines cost £100 per km per year to rent, suggest a design that will yield the most cost effective solution if the installation is to remain in operation for four years. 1st option is - link all branches by providing individual line to each branch via a number of inter branch links to the centre. 2nd option is - link all branches by providing smaller number of multiplexed lines to the centre Please calculate both options and choose the most cost effective solution for four years?

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
icon
Related questions
Question

A bank has its head office in the financial district in the middle of
a city. A bank has six branches, three in the north of the city and three
in the south all 5 km from the centre and spaced 3 km apart. The bank
wishes to link all its branches via private leased lines but must
decide between providing an individual line to each branch  via a
number of inter-branch links and a smaller number of multiplexed lines
to the centre. If a modem costs £100, a multiplexer/demultiplexer
costs £200 and leased lines cost £100 per km per year to rent, suggest
a design that will yield the most cost effective solution if the
installation is to remain in operation for four years.

1st option is - link all branches by providing individual line to each branch via a number of inter branch links to the centre.

2nd option is - link all branches by providing smaller number of multiplexed lines to the centre

Please calculate both options and choose the most cost effective solution

for four years?

Expert Solution
steps

Step by step

Solved in 2 steps with 1 images

Blurred answer
Knowledge Booster
Optimization models
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Practical Management Science
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Business in Action
Business in Action
Operations Management
ISBN:
9780135198100
Author:
BOVEE
Publisher:
PEARSON CO
Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.