Seven Passengers Are on a Waiting List for an Overbooked

question 130

Short Answer

Seven passengers are on a waiting list for an overbooked flight.As a result of cancellations,3 seats become available.How many ways can those 3 available seats be filled regardless of the order?

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Definitions:

Producer Surplus

The difference between what producers are willing to sell a good for and the price they actually receive, representing profit.

Marginal Revenue

Marginal revenue is the additional income generated from the sale of one more unit of a product or service.

Profit Maximizing

The process or strategy of adjusting production and operations to achieve the highest possible profit from business activities.

Economic Efficiency

A situation where resources are allocated in a way that maximizes the production of goods and services at the lowest cost.