10. A car rental company located at a major airport has a fleet of 230 cars,...
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10. A car rental company located at a major airport has a fleet of 230 cars, including 80 compact cars, 120 sedans, and 30 SUVS. The firm charges rental fee of $35, $45, and $60 per day for a compact, a sedan, and a SUV, respectively. When a car is returned to the company, it goes through a service (e.g., cleaning and fixing possible issues) which costs company an average of $10 per car. A study has shown that when a compact car returned by a customer, the car stays in company's lot at the airport for an average of 2 days before it is rented to another customer. This number is 3 days and 4 days for sedans and SUVs, respectively. The study also shows that the company has an average of 28 compacts, 40 sedans, and 8 SUVS available in their lot for customers to rent. a. On average, how long customers keep (rent) compact cars? What about sedans and SUVs? b. Defining fleet utilization as the percentage of cars that are rented (i.e., not sitting idle at the airport), what is the fleet utilization for compact, sedan, and SUV vehicles? c. How many cars, on average, the company rents each day? d. If the company's fixed operating costs (i.e., employees' salary, facility and equipment cost, etc.) is $3000 per day, what is the company's daily profit? 10. A car rental company located at a major airport has a fleet of 230 cars, including 80 compact cars, 120 sedans, and 30 SUVS. The firm charges rental fee of $35, $45, and $60 per day for a compact, a sedan, and a SUV, respectively. When a car is returned to the company, it goes through a service (e.g., cleaning and fixing possible issues) which costs company an average of $10 per car. A study has shown that when a compact car returned by a customer, the car stays in company's lot at the airport for an average of 2 days before it is rented to another customer. This number is 3 days and 4 days for sedans and SUVs, respectively. The study also shows that the company has an average of 28 compacts, 40 sedans, and 8 SUVS available in their lot for customers to rent. a. On average, how long customers keep (rent) compact cars? What about sedans and SUVs? b. Defining fleet utilization as the percentage of cars that are rented (i.e., not sitting idle at the airport), what is the fleet utilization for compact, sedan, and SUV vehicles? c. How many cars, on average, the company rents each day? d. If the company's fixed operating costs (i.e., employees' salary, facility and equipment cost, etc.) is $3000 per day, what is the company's daily profit?
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a The average duration of rental for compact cars is 2 days for sedans is 3 days and for SUVs is 4 d... View the full answer
Related Book For
Service Management Operations Strategy Information Technology
ISBN: 978-0077841201
8th edition
Authors: James Fitzsimmons, Mona Fitzsimmons, Sanjeev Bordoloi
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