Independent of the actual number of passengers on the plane

Assignment Help Operation Management

Reference no: EM131369579

Northwest Airlines runs daily flights from Detroit to Amsterdam. They face a fixed cost of $70,000 for each flight independent of the actual number of passengers on the plane. There are 310 seats available on a plane. One way tickets generate revenues of $600 a piece when used but are fully refundable if not used. On a typical weekday, the airline estimates that the number of no-shows will range between 0 and 20; all intermediate values are equally likely. By law, an airline is allowed to overbook flights, but must give compensation of $250 to all ticketed passengers not allowed to board. In addition, it must provide those passengers with alternative transportation on another carrier (the cost of providing the alternative transportation just wipes out the $600 Revenue). How many tickets should Northwest book on its flight from Detroit to Amsterdam?

Reference no: EM131369579

Questions Cloud

Multi-service aviation business and including fuel : Earhart Aviation operates a multi-service aviation business, including fuel, aircraft maintenance, charter flights, aircraft rentals, and flight instruction. Not only should the user interface be thoroughly tested, there must be sufficient user docum..

Evaluate equation of a trend line to forecast sales : Using the regression feature of Excel, compute equation of a trend line to forecast sales in 2014 and 2015. Note, you can use 'Year' as the explanatory variable or the 'Time Index' as the explanatory variable, but not both in the same equation.

Forensics investigation trainee at two way communications : In this course, you have assumed the role of a forensics investigation trainee at Two Way Communications. You have received positive feedback from the CEO regarding your last report, and you are asked to train with the Internal Security department..

What is the probability that its top executive made : If a firm is randomly chosen from the list of 10 firms studied, what is the probability that its top executive made over $1 million per year?

Independent of the actual number of passengers on the plane : Northwest Airlines runs daily flights from Detroit to Amsterdam. They face a fixed cost of $70,000 for each flight independent of the actual number of passengers on the plane. There are 310 seats available on a plane. One way tickets generate revenue..

Pricing structure of the provider : 1. Do they offer PaaS, SaaS, or both? 2. How is the pricing structure of the provider designed? example price per gb storage price per vm, price per gb data transfer? 2. How easy does it appear to be to set up an account and start using their serv..

Why evaluation is critical to training success : Reflect on and explore the reasons why evaluation is critical to training success. Discuss the reasons evaluation is critical to effectiveness of training. Explain the connection between organizational improvement and training effectiveness.

Relationship among kirkpatricks four levels of evaluation : What is the relationship among Kirkpatrick’s four levels of evaluation? Would you argue for examining all four levels, even if your boss suggested you should look only at the last one (results) and, that if it improved, you would know that training h..

What factors should be considered in designing a job : A multinational corporation has three basic sources to use when staffing its foreign operation. Name two of these sources, and give one advantage and one disadvantage of each. What factors should be considered in designing a job

User Account

All Pages