Practice Questions - Revenue Management

Practice Questions - Revenue Management - having at least...

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Practice Questions: Revenue Management 1. The TasteBest Ham Company finds that the demand can be roughly approximated as a function of price: Demand = 7 – Price Assume the cost of the Company for each package is 1, a. What is the price that maximizes the company’s profit? b. If the Ham Company only has a capacity of 2, what is the price that maximizes the company’s profit? 2. A flight has 50 seats left. The full-fare tickets are priced at $300 and the discount tickets are priced at $200. The airline estimates that the probability of
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Unformatted text preview: having at least 50 more full-fare customers to be 40%. a. To maximize the expected revenue, should the airline sell one more discount ticket? b. How many seats should we reserve for the $300 class? c. If the airline receives and accepts an unexpected bundle order of 20 seats, should the airline sell one more discount ticket? d. Will your answer change if the full-fare tickets are priced at $360 and the discount tickets are priced at $240? 3. Textbook page 446. Problem 6....
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This note was uploaded on 05/08/2008 for the course BUAD 311 taught by Professor Vaitsos during the Spring '07 term at USC.

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