Question: Problem 4 . An airline has found that the number of people who purchased tickets and did not show up for a flight is normally

Problem 4. An airline has found that the number of people who purchased tickets and did not show up for
a flight is normally distributed with mean of 20 and standard deviation of 10. The airline estimates that
the ill will and penalty costs associated with not being able to board a passenger holding confirmed
booking are estimated to be $600. Assume that the opportunity cost of flying an empty seat is $100(price
that a passenger who shows up, would pay). There are 225 seats on the plane. How much should airline
overbook the flight (b**-C)?
 Problem 4. An airline has found that the number of people

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