How many slots should wzmu sell in advance

Reference no: EM136164

WZMU is a television station that has 25 thirty-second ads slots during each evening. The station is now selling ads for the first few days in November. They would sell all the slots now for $4,000 each, but because 7^th November will be an election day, the station can be able to sell slots to political candidates at the last minute for a price of $10,000 each. For now, consider that a slot not sold in advance and not sold at the last minute is worthless to WZMU.

To help make this decision, the sales force has created the subsequent probability distribution for last minute sales:

a) How many slots should WZMU sell in advance?

b) Now assume that if a slot is not sold in advance and is not sold at the last minute, it will be used for a promotional message worth $2500. Now how many slots would WZMU sell in advance?

Reference no: EM136164

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