Problem on standard deviation
Course:- Macroeconomics
Reference No.:- EM1362

Assignment Help
Expertsmind Rated 4.9 / 5 based on 47215 reviews.
Review Site
Assignment Help >> Macroeconomics

Question:The airport branch of a car rental company maintains a fleet of 50 SUVs. The interarrival time between requests for an SUV is 2.4 hours, on average, with a standard deviation of 2.4 hours. There is no indication of a systematic arrival pattern over the course of a day. Assume that, if all SUVs are rented, customers are willing to wait until there is an SUV available. An SUV is rented, on average, for 3 days, with a standard deviation of 1 day.

a. What is the average number of SUVs parked in the company's lot?

 b. Through a marketing survey, the company has discovered that if it reduces its daily rental price of $80 by $25, the average demand would increase to 12 rental requests per day and the average rental duration will become 4 days. Assuming that the std. dev. values stay unchanged, should this company adopt this new pricing policy? Provide an analysis!

c. What is the average time a customer has to wait to rent an SUV? Please use the initial parameters rather than the information in (b).

d. How would the waiting time change if the company decides to limit all SUV rentals to exactly 4 days? Assume that if such a restriction is imposed, the average interarrival time will increase to 3 hours, with the standard deviation changing to 3 hours. 

Put your comment

Ask Question & Get Answers from Experts
Browse some more (Macroeconomics) Materials
The final project provides you with an opportunity to use work from previous papers and discussion forums in formulating your paper, but it will also require additional rese
Suppose that technophiles are willing to pay $400 now for the latest iPhone, but only $300 if they have to wait a year then compute the optimal pricing scheme of the iPhone.
The late Milton Friedman often wrote that instead of imposing countervailing duties on subsidized foreign goods, the United States should write a note of thanks to foreign t
There are two goods 1 and 2. Denote the consumption bundle consisting of x1 units of good 1 and x2 units of good 2.Write down the equation for the indierence curve that passe
After World War II, the United States experienced a "baby boom" as birthrates rose dramatically between 1946-1964. Lower birthrates after 1965 mean that the now aging baby boo
How large is its cyclically adjusted budget deficit? How large is its cyclically adjusted budget deficit as a percentage of potential real GDP? What is the marginal tax rate i
According to the manager of a major Japanese automobile company, since the price elasticity of demand for Japanese cars is more elastic in the United States than it is in Euro
economists sometimes use concentration ratios to evaluate whether industries are oligopolies. In this application, you will make your own determination using the most recent d