Suppose there are 100 seats on a flight from Hong Kong to Seoul. The number of no-shows is normally distributed with mean 20 and
standard deviation 5. The price of an airline ticket is p. The cost per
bumped customer is c. Assume c > p. Choose all of the statements
that are true.

a. According to a new prediction from the marketing department, the
number of no-shows is indeed normally distributed with mean 20 andstandard deviation 10. In this case, the optimal overbooking level islower than that in the original scenario.

b. The airline should sell more than 120 tickets.

c. If the airline makes an arrangement with a partner airline, so that it canreduce the cost for bumped customers by half, then the optimaloverbooking level decreases.

d. If the price of the ticket increases, the optimal overbooking level
increases.