During bad weather, FreeEx has the option of instructing the Washington air controller to place…

During bad weather, FreeEx has the option of instructing the Washington air controller to place its planes in a holding pattern from which planes are directed to land either at Reagan National or at Dulles International, whichever becomes available first. Assume that the Dulles landing rate in bad weather also is 30 per hour, Poisson distributed, and that the combined arrival rate for both airports is 40 per hour. If FreeEx must pay $200 per flight to charter a bus to transport its passengers from Dulles to Reagan National, should it exercise the option of permitting its aircraft to land at Dulles during bad weather? Assume that if the option is used, FreeEx’s aircraft will be diverted to Dulles about onehalf the time.

 

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