South Central Arlines operates a commuter flight between Atlanta and Charlotte. The plane holds 26 passengers, and the a

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South Central Arlines Operates A Commuter Flight Between Atlanta And Charlotte The Plane Holds 26 Passengers And The A 1 (35.5 KiB) Viewed 39 times

South Central Arlines operates a commuter flight between Atlanta and Charlotte. The plane holds 26 passengers, and the airline makes a 597 profit on Each passenger an the flight. When South Central takes 24 reservations for the tlight, experience has shown that, on averape, two passengers do not show up. As a result, with 26 reservations, South Central is averaging 24 passengers with a profit of 24(97)=$2,328 per flight. The airline operations office has asked for an evaluation of an overbooking strategy in which the oirline would accept 28 reservations even though the airplane holds only 26 passengers. The probability. distribution for the number of passengers showing up when 28 reservations are accepted is as follows: The airitre will receive a profit of $97 for each passenger on the flight, up to the capacity of 26 passengers. The airline will also incur a cost for any passenger denied seating on the fight. This cost covers added expenses of rescheduling the passenger as well as loss of goodwill, estimated to be \$120 per passenger Dewelop a worksheet model that will simulate the performance of the overbooking system. Simulate the number of passengers showing up for each of 500 fighth by wing the VIOOKUP function. Use the results to compute the profit for each flight. a. Does yout simulation recommend the overbooking strategy? What is the mean profit per flight if overbooking is implemented? Round your answer to the nearest dollar. Over 5