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snow_tiger [21]
2 years ago
13

Problem 11-5 Next week, Super Discount Airlines has a flight from New York to Los Angeles that will be booked to capacity. The a

irline knows from past history that an average of 40 customers (with a standard deviation of 26) cancel their reservation or do not show for the flight. Revenue from a ticket on the flight is $140. If the flight is overbooked, the airline has a policy of getting the customer on the next available flight and giving the person a free round-trip ticket on a future flight. The cost of this free round-trip ticket averages $270. Super Discount considers the cost of flying the plane from New York to Los Angeles a sunk cost. By how many seats should Super Discount overbook the flight? (Use Excel's NORMSINV() function to find the correct critical value for the given α-level. Do not round intermediate calculations. Round your answer to the nearest whole number.) Overbooked by passengers
Business
1 answer:
Goshia [24]2 years ago
3 0

Answer:

29 Seats

Explanation:

Calculation to determine By how many seats should Super Discount overbook the flight

First step is to calculate the Critical ratio using this formula

Critical ratio=Cu/Cu +Co

Where,

Cu represent cost of underestimating the demand =$140

Co represent the cost of overestimating the demand =$270

Let plug in the formula

Critical ratio=$140/$140+$270

Critical ratio=$140/$410

Critical ratio=0.34146

Second step is to use Excel's NORMSINV() function to find thez-score that yields a p-value of 0.34146 which gives us -0.40848

Now let determine By how many seats should Super Discount overbook the flight

Numbers of seats to overbook the flight= 40 + (-0.40848 x 26)

Numbers of seats to overbook the flight=40 - 10.62048=

Numbers of seats to overbook the flight=29.37952

Numbers of seats to overbook the flight=29.4 seats (Approximately)

Numbers of seats to overbook the flight=29 seats (Rounded to the nearest whole number)

Therefore By how many seats should Super Discount overbook the flight is 29 seats

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26.67

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3 years ago
Fiscal Policy
cricket20 [7]

Based on the economic data given, and the fact that the government is running a deficit, the equilibrium GDP will be 336.67.

If government spending is cut to balance the budget, the new level of GDP will be 321.67.

The effect of balancing the budget will be a decrease in GDP and a slower recovery from the recesssion.

<h3>What is the equilibrium GDP?</h3>

This is given by the variable "Y" so we can find the equilibrium GDP by solving for it:
C = 50 + .7(Y – T)

Y = C + I + G - XN

C = Y - I - G + XN

Solving gives:

Y - I - G + XN =  50 + .7(Y – T)

Y - 40 - 35 + 10 = 50 + 0.7Y - 14

Y - 0.7Y = 50 + 40 + 35 - 10 - 14

0.3Y = 101

Y = 101/0.3

= 336.67

<h3>What is the new GDP if government spending is cut?</h3>

Government spending will have to be cut to a size that would make it equal to taxes so government spending becomes 20.

New GDP becomes:

= C + I + G - XN

= ( 50 + .7(Y – T)) + 40 + 20 - 10

= 271.67 + 40 + 20 - 10

= 321.67

Find out more on GDP at brainly.com/question/1384502.

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2 years ago
In what kind of estate does ownership revert to the grantor of the estate if usage fails to conform to a stated condition in the
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Answer:

The correct answer is a Fee simple defeasible estate.

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A fee simple defeasible estate is a type of property that has some conditions attached to it. In case the conditions are not conformed the estate goes back to the grantor.

The holder of such an estate holds it as a fee simple subject to that condition. If the given condition is not met the estate either goes to the original grantor or to a third party.

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For its first year of operations, Tringali Corporation's reconciliation of pretax accounting income to taxable income is as foll
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Answer:

$5,225

Explanation:

Calculation for What should Tringali report as its deferred income tax liability as of the end of its first year of operations

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Deferred income tax liability=$5,225

Therefore What Tringali should report as its deferred income tax liability as of the end of its first year of operations is $5,225

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