Below is a decision tree for the airline revenue management.Create a one-way data table to answer the following question(s).
-What is the expected value of the ticket when a discount is offered on the fare?
A)$420
B)$600
C)$450
D)$480

Question

Below is a decision tree for the airline revenue management.Create a one-way data table to answer the following question(s). 
-What is the expected value of the ticket when a discount is offered on the fare?
A)$420 
B)$600 
C)$450 
D)$480

Quizplus · Accepted Answer

The expected value of the ticket when a discount is offered on the fare is $420. This is because the probability of getting a 20% discount is 0.2, and the probability of getting a 10% discount is 0.3. The expected value of the ticket with a 20% discount is $480, and the expected value of the ticket with a 10% discount is $450. Therefore, the expected value of the ticket when a discount is offered on the fare is 0.2 * $480 + 0.3 * $450 = $420.

Below Is a Decision Tree for the Airline Revenue Management