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In this exercise we will focus exclusively on westbound operations. Table 2 shows the eight westbound itineraries offered and their current prices for both Q-Class

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In this exercise we will focus exclusively on westbound operations. Table 2 shows the eight westbound itineraries offered and their current prices for both Q-Class and Y-Class fares. Based on historical data and appealing to the Central Limit Theorem, planners at Capitol usually model demands for different fare classes on a given flight as independent normally distributed random variables: the means and standard deviations are estimated using historical data. Table 3 shows estimates of the mean u and standard deviation o of demand for each fare class on each westbound flight for a typical Monday. Q-Class demand Y-Class demand Itinerary (Number of Passengers) (Number of Passengers) From: To: O O BOSTON CHICAGO 25.0 5.3 20.0 5.2 BOSTON SAN FRANCISCO 55.0 5.1 40.0 6.0 BOSTON LOS ANGELES 65.0 9.3 25.0 4.8 NEW YORK CHICAGO 24.0 4.4 16.0 3.0 NEW YORK SAN FRANCISCO 65.0 8.4 50.0 6.9 NEW YORK LOS ANGELES 40.0 5.1 35.0 6.3 CHICAGO SAN FRANCISCO 21.0 6.2 20.0 3.7 CHICAGO LOS ANGELES 25.0 5.2 14.0 2.4 TABLE 3. Demand data for westbound flights on Mondays Assuming for simplicity that demand is deterministic (that is, proceeding as if all of the standard deviations in Table 3 were zero), what combination of reservations should the airline accept in order to maximize the revenue derived from westbound flights

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