CU Airlines operates two flights, one from New York to Phoenix and another one from Phoenix to San Francisco. It sells a full fare and a discount fare for each leg, and a single fare for the combined leg from New York to San Francisco. The airline has assigned a 120-seat aircraft for the first flight and a 100-seat aircraft for the second flight. The demand for each fare is assumed to be random and normally distributed. The fares and demands for these flights are shown in the following table:

Formulate the problem as a deterministic network linear program using the means. What is the optimal allocation and revenue?

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Number ODF 1 2 3 4 5 NYC-PHX full fare NYC-PHX discount fare PHX-SFO full fare PHX-SFO discount fare NYC-SFO fare Fare $300 $200 $250 $150 $300 Demand mean 30 70 20 50 40 Demand std. dev. 6 20 5 15 15 Number ODF 1 2 3 4 5 NYC-PHX full fare NYC-PHX discount fare PHX-SFO full fare PHX-SFO discount fare NYC-SFO fare Fare $300 $200 $250 $150 $300 Demand mean 30 70 20 50 40 Demand std. dev. 6 20 5 15 15

Answer rating: 100% (QA)

Formula Formula Formula Formula 1 2 3 4 5 6 7 8 9 10 A B Leg 1 1 Phoenix ... View the full answer