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Please help! The ticket price for a flight is $200. Each plane can hold up to 100 passengers. Usually, some of the passengers who have

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The ticket price for a flight is $200. Each plane can hold up to 100 passengers. Usually, some of the passengers who have purchased tickets for a flight fail to show up (no-shows). To protect against no-shows, the airline will try to sell more than 100 tickets for each flight. This flight is popular so the airline can sell all tickets that they offer (even if it is more than 100). Any ticketed customer who is unable to board the plane is entitled to $100 compensation in addition to $200 refund. Past data indicate that the number of no-shows for this flight is equally likely to be any integer from 10 to 20. Assume that anybody who does not use a ticket receives a $200 refund. The goal is to find optimal value of q to maximize expected value of revenues less compensation costs. . Let q represent the number of oversold tickets by airline. . Let D represent the number of no-shows. For example, suppose that the airline sells q = 5 more tickets (so sells 105 tickets). If D = 10 do not show up, the airline refunds 10 x $200 = $2000 only. If D = 3 do not show up, 2 ticked passengers cannot board the plane. Thus the airline pays 2 x $300 = $600 (refund+compensation) in addition to 3 x $200 = $600 refund. (a) (7 points) Give an expression for the expected value of revenues less compensation costs, E revenues - compensation cost] (using notation D, q, E[.], A, or (.)+), and then calculate the newsvendor ratio.b) Using the newsvendor ratio you calculated in part (a), calculate the optimal value of q. If you could not find your newsvendor ratio in part (a), then just assume that your newsvendor ratio is 0.7

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