Revenue management assignments

Assignment Help Operation Management

Reference no: EM131159337

Please answer this question in excel or if you could show the formulas and functions.

Revenue Management Assignments II. San Francisco Express Airlines, SaFE for short, flies from PHL to SFO. On a Thursday evening flight, the number of last-minute no-shows and cancellations is Poisson distributed with mean 7.5. SaFE has an unlimited number of low fare travelers who pay $300. The cost of bumping such a passenger is estimated to be $350 (due lost good will as well as the cost of routing their itinerary through other airlines). SaFE offers this low fare because it also comes with a cancellation/rebooking fee of $150 – if a customer doesn’t show up for the flight or cancels her reservation, she must pay $150 to use the ticket on another flight.

1) To maximize revenue from this flight, how many seats should the airline overbook?

2) Customers are more reliable on the Friday evening flight. On that flight, the average number of no shows and cancellations is Poisson with mean 4.5. Suppose SaFE overbooks that flight by 6 seats. What is the probability that at least 1 passenger will be bumped from this flight?

Reference no: EM131159337

Questions Cloud

Promtoes public awareness of importance of the park systems : Athletic trainers can expect to teach a partial load of classes when employed by a school. An internship is usually required for those looking to get into the field of sports management. The National Recreation and Park Association (NRPA) promtoes pu..

What is meant by the term strategic group : What is meant by the term “strategic group,” and why is it important for managers to understand this in order to position their companies in a competitive marketplace?

True one regarding sport communications : What statement below is not a true one regarding sport communications?

Which product should the pitch fly firm purchase and why : Which product option is best for the Pitch Fly firm. They buy pitch kettles for $19.00 from the SNG firm but can sell them for $25.00 with a 24% markup. However, if they buy them from Joggy Sands they can sell them for $35.00 but must pay 31.00 per p..

Revenue management assignments : Revenue Management Assignments II. San Francisco Express Airlines, SaFE for short, flies from PHL to SFO. On a Thursday evening flight, the number of last-minute no-shows and cancellations is Poisson distributed with mean 7.5. To maximize revenue fro..

Employees are compensated in private vs public sector : Is there a difference between how employees are compensated in the private vs. public (government) sector? What has evolved over the years with wages and benefits with government workers?

Subway global franchising : Subway Global Franchising, describe its business model, its international expansion pattern, disirable qualifications in possible franchisees, and the support and training the company typically provides.

Linear programming model for production planning : The Delight Dairy Company produces a broad line of dairy products. For production planning purposes, the company has been aggregated into two major products: Ice Cream and Specialties such as ice cream sandwiches and prepackaged ice cream. Formulate ..

What is the planned order receipt in week : One hundred units of end item E are needed at the beginning of week 6 and lead-time for E is 2 weeks . two cases (200 units per case) of J have been ordered and are scheduled to arrive (receive) in week 1. Note: J must be ordered by the case, B must ..

User Account

All Pages