Question: Question 5

A study by professors in the Business School at the University of Tasmania revealed that the response time to 000 emergency calls was 4.8 minutes, with a standard deviation of 1.2 minutes. It was assumed that response times were normally distributed. The Mayor of Hobart wanted to reduce mean response time enough so that 40 per cent of all calls were answered within 3.5 minutes.

It was estimated that the cost for patrol cars, fire units and personnel would be
$575, 000 for every reduction of 30 seconds. The necessary revenue was to be raised by a property tax. However, the Mayor felt that the tax burden should be borne only by those homes above $70,000 in assessed value. Homes averaged $45,000 in value with a standard deviation of $15,110. The Mayor felt that an average of an additional $96 could be raised for each home in Hobart over $70,000. There are 42,000 homes in the Hobart city limits. Based on these constraints discuss the feasibility or not of the Mayor’s plan.