Managing Capacity and Demand Handouts 1) The Hotel California found that it frequently turned down a customer in the lobby because a room was reserved for a customer who never showed up. As the hotel manager, you decide the hotel's policy of overbooking should be examined. The average room rate is $50 per night and it is estimated that the total loss associated with overbooking is $120 per overbooked room. The hotel's no-show experience is summarized in the table below. Source: Adapted from Metters, R., King-Metters, K., and Pullman, M. (2003). Successful service operations management. Thomson South-western; p. 159 -163. a) What is the expected number of no-shows? b) Fill out the overbooking loss table for 0,1 , and 2 reservationsoverbooked. \# of Reservations Overbooked c) What should the overbooking policy be based on the provided no-show data using thecritical fractile ratio? Managing Capacity and Demand Handouts 1) The Hotel California found that it frequently turned down a customer in the lobby because a room was reserved for a customer who never showed up. As the hotel manager, you decide the hotel's policy of overbooking should be examined. The average room rate is $50 per night and it is estimated that the total loss associated with overbooking is $120 per overbooked room. The hotel's no-show experience is summarized in the table below. Source: Adapted from Metters, R., King-Metters, K., and Pullman, M. (2003). Successful service operations management. Thomson South-western; p. 159 -163. a) What is the expected number of no-shows? b) Fill out the overbooking loss table for 0,1 , and 2 reservationsoverbooked. \# of Reservations Overbooked c) What should the overbooking policy be based on the provided no-show data using thecritical fractile ratio