5. The Flying Goose ski lodge is gearing up for midwinter school vacation week, which is traditionally one of its busiest and most profitable weeks of the ski season. The lodge's 40 rooms go for $80 per night, which is one of the least expensive lodges in the area. The lodge requires that guests cancel 48 hours prior to the reservation date in order to receive a refund. However, it is often still difficult to fill those rooms at the last minute; thus, Flying Goose sometimes overbooks. But if the lodge is filled when the overbooked guests show up, the Flying Goose must find accommodations at other inns or hotels for those guests at its own expense, at a cost of $140 per room or more. The probabilities of no-shows are shown in the decision matrix below. How many rooms should the Flying Goose overbook?

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ALTERNATIVE Number of Cancellations STRATEGIES 0 1 2 3 Probability 0.5 0.25 0.15 0.10 Overbook ( Overbook 1 Overbook 2 Overbook 3