Consider Exercise 8.5 again. What will be the total expected cost

(TEC) under the following extreme cases, for the different values of

(C1, C2).

a. No overbooking

b. Overbook to the maximum of 15 Compare the total cost of the two extreme cases with the total cost of the optimal policies obtained in Exercise 8.5.

Data From Exercise 8.5:

Consider the no-show data given in Table 8.1.

Determine the overbooking policies for the following spoilage cost

(C1) and oversold penalty (C2).

a. C1 = $100, C2 = $50

b. C1 = $100, C2 = $100

c. C1 = $100, C2 = $200

d. C1 = $100, C2 = $300

e. C1 = $100, C2 = $400

Transcribed Image Text:

TABLE 8.1 No-Show Data for Example 8.3 No-Shows (X) 0 1 2 3 4 5678 9 10 11 12 13. 14 15 Frequency (p) 5% 5% 5% 5% 10% 10% 10% 10% 10% 10% 10% 2% 2% 2% 2% 2% Cumulative Probability F(x) 0.05 0.1 0.15 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 0.92 0.94 0.96 0.98 1.0