A hotel near the university always fills up on the evening before football games. History has shown

Question:

A hotel near the university always fills up on the evening before football games. History has shown that when the hotel is fully booked, the number of last-minute cancellations has a mean of 5 and standard deviation of 3. The average room rate is $80. When the hotel is overbooked, policy is to find a room in a near- by hotel and to pay for the room for the customer. This usually costs the hotel approximately $200 since rooms booked on such late notice are expensive. How many rooms should the hotel overbook?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Operations Management For Competitive Advantage

ISBN: 1572

11th Edition

Authors: Richard B. Chase, F. Robert Jacobs

Question Posted: