Freedom Airlines recently started operations in the Southwest.The airline owns two airplanes, one based in Phoenix and the otherin Denver. Each airplane has a coach section with 140 seatsavailable. Each afternoon, the Phoenix based airplane flies to SanFrancisco with stopovers in Las Vegas and in San Diego. TheDenver-based airplane also flies to San Francisco with stopovers inLas Vegas and in San Diego. Each airplane returns to its home-basewith no stopovers.

Freedom Airlines uses two coach-fare classes: A discount fare(A) and a full fare (B). Discount fares are available with a 21-dayadvance purchase. Full fares applied at any time, up to the time ofthe flight.

Below is the daily fare and demand data for 16 selected FreedomAirline itineraries. Itineraries 1 through 6 apply to the Phoenixbased airplane (leg 1); itineraries 7 through 12 apply to theDenver based airplane (leg 2); itineraries 13 and 14 apply to thePhoenix based airplane (leg 3); itineraries 15 and 16 apply to theDenver based airplane (leg 4):

1	Phoenix	Las Vegas	A	$ 180.00	50
2	Phoenix	San Diego	A	$ 270.00	40
3	Phoenix	San Francisco	A	$ 230.00	35
4	Phoenix	Las Vegas	B	$ 380.00	15
5	Phoenix	San Diego	B	$ 460.00	10
6	Phoenix	San Francisco	B	$ 560.00	15
7	Denver	Las Vegas	A	$ 200.00	50
8	Denver	San Diego	A	$ 250.00	45
9	Denver	San Francisco	A	$ 350.00	40
10	Denver	Las Vegas	B	$ 385.00	15
11	Denver	San Diego	B	$ 445.00	10
12	Denver	San Francisco	B	$ 580.00	10
13	San Francisco	Phoenix	A	$ 250.00	70
14	San Francisco	Phoenix	B	$ 600.00	10
15	San Francisco	Denver	A	$ 325.00	50
16	San Francisco	Denver	B	$ 585.00	10

1. Develop a revenue management (maximizing) model based on theinformation given in the scenario.
2. How many seats should be allocated toeach of the 16 itineraries to maximizerevenue?
3. What is the (maximum) expected revenue to be earned per day forall 16 flights?
4. Assume operating costs for each of the legs is as follows:
5. Leg 1 = $20,250
6. Leg 2 = $19,750
7. Leg 3 = $20,500
8. Leg 4 = $19,500

What is the expected operating income foreach of the legs? And intotal for Freedom Airlines, given these16 itineraries?

1. Develop a revenue management (maximizing) model based on theinformation given in the scenario.
2. How many seats should be allocated toeach of the 16 itineraries to maximizerevenue?
3. What is the (maximum) expected revenue to be earned per day forall 16 flights?
4. Assume operating costs for each of the legs is as follows:
   1. Leg 1 = $20,250
   2. Leg 2 = $19,750
   3. Leg 3 = $20,500
   4. Leg 4 = $19,500

What is the expected operating income foreach of the legs? And intotal for Freedom Airlines, given these16 itineraries?