Question: Managers at the Dew Drop Inn are concerned about the

Managers at the Dew Drop Inn are concerned about the increasing number of guests who make reservations but fail to show up. They have decided to institute a policy of overbooking like larger hotel chains. The profit from a paying guest averages $50 per room per night. The cost of putting up a guest at another hotel is $100 per room per night.
Records show the following number of no-shows over the past three months:
No-Shows Frequency
0 ...........18
1 ...........36
2 ...........27
3 ...............9
How many rooms should Dew Drop overbook?


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  • CreatedOctober 03, 2012
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