The Platinum Star Hotel in Kingston, NY, is considering doing overbooking in order to deal with the constant problem they have with no-shows. The table given below presents the number of no-shows and the probability of each occurring. Number of Shows (d) Probability of No-shows Occurring P(d) 0 0.10 1 0.07 2 0.12 3 0.02 4 0.07 5 0.01 6 0.04 7 0.19 8 0.22 9 0.16 a) What would be your recommendation for overbooking if the average rate per room per night is S125 and the cost of not honoring a reservation is $155? b) What is the expected loss for your overbooking choice? c) State the reasoning for selecting your overbooking choice?
The Platinum Star Hotel in Kingston, NY, is considering doing overbooking in order to deal with the constant problem they have with no-shows. The table given below presents the number of no-shows and the probability of each occurring. Number of Shows (d) Probability of No-shows Occurring P(d) 0 0.10 1 0.07 2 0.12 3 0.02 4 0.07 5 0.01 6 0.04 7 0.19 8 0.22 9 0.16 a) What would be your recommendation for overbooking if the average rate per room per night is S125 and the cost of not honoring a reservation is $155? b) What is the expected loss for your overbooking choice? c) State the reasoning for selecting your overbooking choice?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter10: Introduction To Simulation Modeling
Section10.4: Simulation With Built-in Excel Tools
Problem 12P: In August of the current year, a car dealer is trying to determine how many cars of the next model...
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The Platinum Star Hotel in Kingston, NY, is considering doing overbooking in order to deal with the constant problem they have with no-shows. The table given below presents the number of no-shows and the probability of each occurring.
Number of Shows (d) | Probability of No-shows Occurring P(d) |
0 | 0.10 |
1 | 0.07 |
2 | 0.12 |
3 | 0.02 |
4 | 0.07 |
5 | 0.01 |
6 | 0.04 |
7 | 0.19 |
8 | 0.22 |
9 | 0.16 |
a) What would be your recommendation for overbooking if the average rate per room per night is S125 and the cost of not honoring a reservation is $155?
b) What is the expected loss for your overbooking choice?
c) State the reasoning for selecting your overbooking choice?
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