How many rooms should the hotel overbook

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Reference no: EM131783129

A hotel near the university always fills up on the evening before basketball games. History has shown that when the hotel is fully booked, the number of last-minute cancellations has a mean of 14 and standard deviation of 8. The average room rate is $81. When the hotel is overbooked, the policy is to find a room in a nearby hotel and to pay for the room for the customer. This usually costs the hotel $201 (net of the room rate) since rooms booked on such late notice are expensive. How many rooms should the hotel overbook? Round your answer to the nearest integer.

Reference no: EM131783129

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