Question 3 Consider the following airline capacity allocation problem with buy-up. The total capacity is 100.There are three classes. All class demands follow normal distribution. The fare prices and demand statistics are given as follows: Class Fare Mean Std. Dev. 1 1000 17 6 2 900 45 15 3 500 90 20 Suppose that if a class 3 demand is rejected booking, each individual has a probability of 0.3 to become a class 2 demand; and if a class 2 demand is rejected booking, each individual has a probability of 0.2 to become a class 1 demand. The airline company needs to determine the nested protection levels. Use @risk simulation optimization tofind the optimal decisions. (Please round all the simulated numbers and solutions to the nearest integer.)

Question 3 Consider the following airline capacity allocation problem with buy-up. The total capacity is 100.There are three classes. All class demands follow normal distribution. The fare prices and demand statistics are given as follows: Class Fare Mean Std. Dev. 1 1000 17 6 2 900 45 15 3 500 90 20 Suppose that if a class 3 demand is rejected booking, each individual has a probability of 0.3 to become a class 2 demand; and if a class 2 demand is rejected booking, each individual has a probability of 0.2 to become a class 1 demand. The airline company needs to determine the nested protection levels. Use @risk simulation optimization tofind the optimal decisions. (Please round all the simulated numbers and solutions to the nearest integer.)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter16: Labor Markets

Section: Chapter Questions

Problem 16.9P

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