Indian Airways knows from past data that for a particular route, an average of 25 business customers (with a standard deviation of 15) cancel their bookings and do not show up for the flight. The revenue per ticket is INR 12,500. If the flight is overbooked, the airline has a policy of getting the customer the next available flight, as well as a free round trip ticket, the cost of which is USD 25,000. By how many seats should the airline overbook its flight (round up the value)? Provide the calculation. Answers should be in a Microsoft Word/Microsoft Excel file and include calculations wherever necessary to justify your answer.
Indian Airways knows from past data that for a particular route, an average of 25 business customers (with a standard deviation of 15) cancel their bookings and do not show up for the flight. The revenue per ticket is INR 12,500. If the flight is overbooked, the airline has a policy of getting the customer the next available flight, as well as a free round trip ticket, the cost of which is USD 25,000. By how many seats should the airline overbook its flight (round up the value)? Provide the calculation. Answers should be in a Microsoft Word/Microsoft Excel file and include calculations wherever necessary to justify your answer.
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...
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Indian Airways knows from past data that for a particular route, an average of 25 business customers (with a standard deviation of 15) cancel their bookings and do not show up for the flight. The revenue per ticket is INR 12,500. If the flight is overbooked, the airline has a policy of getting the customer the next available flight, as well as a free round trip ticket, the cost of which is USD 25,000. By how many seats should the airline overbook its flight (round up the value)? Provide the calculation.
Answers should be in a Microsoft Word/Microsoft Excel file and include calculations wherever necessary to justify your answer.
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