Town and Country operates a single office at a major international airport, with a fleet of 60 compacts and 30 midsize cars. Recent developments have prompted management to rethink the company´s reservation policy. The table below contains data on the rental experience of Town and Country CarRental RateDiscount RateDiscount SeekersDaily DemandStandard Deviation Compact$ 30$ 2080P15 Midsize$ 40$ 3060010 The daily demand appears to follow a normal distribution; however, it has been observed, that midsize-car customers do not choose to rent a compact when no midsize car is available. •What is the optimal number of compact and midsize cars to be held for customers paying the full rate? •Given the optimal reservation policy determined here, would you consider a fleet expansion?
