Question

A firm is looking to lease improved high-speed data transmission lines between two remote locations from a service provider. Currently they transfer files with an average size of 100MB (megabytes) on a T1 line rated at 1.5 Mbps (megabytes per second) and it takes 9.4 minutes to transfer this file. It is estimated that in an 8-hour day, this data transfer happens 2 times per day each for 20 employees in a certain group and that each employee makes (including benefits) on average $100,000 per year for a 236-day work year [365-day year – 104 days for weekends – 10 holidays – 15 days (3 weeks vacation)]. If they go to higher speed transmission lines at 10 Mbps, how much in total ($$ savings) would this add to the total productivity of the employees in this group?

Answer 1

For T1,

Average size = 100MB

Rate 1.5Mbps

Time = 9.4minutes

Time for sending twice = 18.4minutes

2 times per day in 8hour day

Number of employees = 20

Working Day = 236days

Each employee average earning = $100,000 per year

By using 10Mbps the file can be transferred in less time

T₁₀₀ = 1.5 x 9.4 / 100 = 0.141 minutes

So, the file can be transferred in 0.141 minutes

Time for sending 100MB file twice at 100Mbps = 0.141 x2 = 0.282minutes

Time saved by using 100Mbps per day = 18.8 - 0.242

=18.558 minutes/day

Time saved by each employee in a year (236 work -day)= 236 x 18.558

= 4379.688 minutes

Time saved by each employee in a year (236 work -day)(in days each work day - 8 hours)

= 9.12435 working day

Since each employee makes profit in 236 working day = $ 100,000

So,  each employee makes profit in 1 working day in $  

So, each employee makes profit in 9.12345 working day in $

= 3865.8686 $

Thus, in total ($$ savings) this would add to the total productivity of the employees in this group = 3865.8686 $