Calculate the expected revenue-expected variable costs

Assignment Help Business Economics

Reference no: EM13833388

Suppose the hotel in the lecture example raised its price from $30 to $30.50. With the new price, the hotel expects 96 guests to arrive 5% of the time, 97 guests 10% of the time, 98 guests 20% of the time, 99 guests 30% of the time, 100 guests 25% of the time and 101 guests 10% of the time. The variable costs per occupied room and overbooking costs are the same as in the lecture.

Calculate the expected revenue, expected variable costs and expected costs from overbooking. 0

Using marginal analysis, should the hotel raise its price? Explain your answer.

Reference no: EM13833388

Questions Cloud

Promote lifelong harmonious social interaction : promote lifelong harmonious social interaction

What is the average fraction of gdp this amount consisted : Collect data on the monetary base in the U.S. What was the size of the monetary base in August of 2007? What about in August of 2009? If the inflation tax is the ?M and the monetary base is our measure of M, then how much revenue was raised from the ..

What is the cost per piece produced : You have a machine that costs $30,000 now and can be sold for $13,000 in year 4. The machine costs $12,000 each year to operate and the raw materials cost $10,000 each year. The machine produces 500 pieces each year. Using an interest rate of 7%, wha..

How does this add value and costs : Please select a brand and describe the marketing channel the brand will pass through on the way to the end user. How does this add value and costs?

Calculate the expected revenue-expected variable costs : Suppose the hotel in the lecture example raised its price from $30 to $30.50. With the new price, the hotel expects 96 guests to arrive 5% of the time, 97 guests 10% of the time, 98 guests 20% of the time, 99 guests 30% of the time, 100 guests 25% of..

How about convexity : Graphically show and verbally argue that a Walrasian equiblirium in an economy is Pareto efficient as long as preferences are locally non-satiated. How about convexity? ?s it important for this theorem to hold ?

Lending capacity on the banking system increase or decrease : If the Fed sells $20 million worth of government bonds to the public (open market sale), will the lending capacity on the banking system increase or decrease? By how much will the money supply change? Assume the required reserve ratio to be 0.1.

The author''s intended audience : Find an article regarding how an employee's compensation can influence his/her behavior on the job. After reading the article you will compose an article critique. Your critique will be at least two pages in length, and in the critique, you will incl..

If the fed intends to decrease the money supply : If the Fed intends to decrease the money supply, what tools can be used? Briefly explain how each tool should be implemented.

User Account

All Pages