You will need to use Excel SOLVER. Consider the following questions in your analysis (4 pages max, excluding exhibits):

1) The historical Revenue Management application businesses are airlines, hotels, and rental cars. In what way is container shipping similar to or different from these application areas? [6 pts] 2) Considering the given weight and TEU capacity of each vessel and using the data provided in Exhibit 1, determine the maximum revenue that can be obtained per vessel with the existing prices during high season.[10 pts]

3) Considering the given weight and TEU capacity of each vessel and using the data provided in Exhibit 1, determine the maximum revenue that can be obtained per vessel with the existing prices during low season.[10 pts]

4) For the variable pricing model, determine the demand curves of high and low season separately for each port. Hint: Find the slope and the intercept of the demand curve (b and a in TEU= a b*p). [8 pts]

5) Determine the price for each port and the split of containers between 20-foot and 40-foot so that revenue is maximized subject to weight and TEU capacity constraints during high season only. [16 pts]

Exhibit 1:

Port of Origin / Price($/TEU) / High SeasonDemand(TEU) / Low SeasonDemand(TEU) / SizesRatio 20':40 / Weight of 20' Container(tons) / Weight of 40' Container(tons)

Japan $940.00 320 286 30-70 20 24

China $878.00 68 61 40-60 18 23

Hong Kong $766.00 737 660 42-58 19 22

Indonesia $840.00 68 61 40-60 21 25

India $790.00 340 304 40-60 22 22

Korea $710.00 35 31 46-54 21 25

Malaysia $643.00 138 123 54-46 20 22

Singapore $649.00 43 38 39-61 19 25

Taiwan $702.00 41 37 41-59 19 19

Thailand $663.00 9 8 20-80 23 26