3.

4.

Now you will use Excel's Solver tool to find the best plan. You will determine how many

customers from each tier and LOS to admit for each arrival date during 9/2-9/6. That means you will

have 45 decision variables (variable cells in Solver). Your objective is to maximize total revenue

(room + gaming). Note that a customer with LOS=2 will bring 2 days of Revenues

Keep in mind that your plan should be feasible: (i) Your plan cannot use more rooms than what is

available on a given night (Table 3); (ii) You cannot admit more customers than what is forecasted

(Table 2); (iii) Your decision variables should be positive (the number of admitted customer should

be non-negative for each tier, LOS and arrival date). You need to specify these constraints in

Solver. Finally, please choose Simplex LP as your solution method. This choice will allow you to

ask for a sensitivity report once you run the Solver.

What is the maximum total revenue under the best plan?

The sensitivity report provides shadow prices for each constraint. Furthermore, the shadow

prices of room capacity constraints provide the opportunity cost of a room on a given night. These

are the clearing (bid) prices for each night of stay. What are the clearing prices for 9/2, 9/3, 9/4, 9/5

and 9/6?

When do we accept a reservation request from a Tier 1 customer given these clearing prices (List

the arrival date and LOS pairs that will make a Tier 1 customer attractive)?