Problem

Based on Hansen and Wendell (1982). During the month of July, Pittsburgh resident Bill F...

Based on Hansen and Wendell (1982). During the month of July, Pittsburgh resident Bill Fly must make four round-trip flights between Pittsburgh and Chicago. The dates of the trips are shown in the file P05_83.xlsx. Bill must purchase four round-trip tickets. Without a discounted fare, a round-trip ticket between Pittsburgh and Chicago costs $500. If Bill’s stay in a city includes a weekend, he gets a 20% discount on the round-trip fare. If his stay is more than 10 days, he receives a 30% discount, and if his stay in a city is at least 21 days, he receives a 35% discount. However, at most one discount can be applied toward the purchase of any ticket. Determine how to minimize the total cost of purchasing the four round-trip tickets. (Hint: It might be beneficial to pair one half of one round-trip ticket number with half of another round-trip ticket.)

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