solution

Suppose REI has decided to set up a subscription-based rental ski business. In this model, customers pay a flat subscription fee on a monthly basis and can rent skis for one weekend at a time whenever they want at no additional charge. With this model REI is focused on ensuring sufficient inventory availability to their customers who subscribe. Assume the same data as discussed in the REI Rentals case.

Suppose they keep 3 pairs of skis in Salt Lake City. What is the probability one of their subscribers WILL be able to rent a pair of skis on a given weekend?

A. 78% B. 58% C. 88% D. 68%

What’s the smallest number of skis they would need to stock at Salt Lake City?

A. 8 B. 10 C. 7 D. 9