One explanation for the widespread use of allocated fixed costs is that they can serve as a proxy for difficult-to-calculate opportunity costs. This explanation is pursued by modeling a service department as an M/M/s/s queueing system. Two main results are that the expected value of opportunity...

A single server provides FIFO services commencing at time 0. Each member of a population of N potential customers must decide whether or not to arrive at the facility. Customers choosing to arrive must do so no later than time 0. This paper studies the benefit to customers: the value of service...