Distribution Type 1: Normal distribution with mean = 75 and std. dev = 25

Distribution Type 2: Uniform Distribution U[50,100]

Distribution Type 3: Discrete Distribution

Q2. Protection Level: Lets say you are the Hotel Manager of Hotel Holiday. You have 300 rooms in the hotel. A famous band is organizing a concert near your hotel. Music fans can either book the hotel in advance for a discounted price of $100/night or wait until the last minute to book a room at a price of $300/night. The demand is large enough that you can sell out all rooms at $100/night. Answer the following questions based on the above info.

2A. What is the underage cost? What does this cost represent?

2B. What is the overage cost? What does this cost represent?

2C. What is the critical ratio? What does critical ratio represent?

2D. If demand of last-minute music fans is distributed as distribution type 1, then how many rooms will you set aside for last-minute music fans? What is the Booking Limit for the discounted rooms?

2E. If demand of last-minute music fans is distributed as distribution type 2, then how many rooms will you set aside for last-minute music fans? What is the Booking Limit for the discounted rooms?

2F. If demand of last-minute music fans is distributed as distribution type 3, then how many rooms will you set aside for last-minute music fans? What is the Booking Limit for the discounted rooms?