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Please provide responses for the below 3 questions:
A 400 room hotel by an airport discounts heavily (sometimes as much as 50 percent off the rack rate) on Sunday nights since they historically sold an average of 100 rooms on that night. Historical data indicates that over the past two months, occupancy percentage on Sunday nights averaged slightly less than 25%. Today is Sunday, and the PMS shows the property currently has 110 reservations on the books. The weather forecast, however, is for extremely heavy snowstorms of the type that have, in the past, signi?cantly delayed ?ights or closed the airport. On nights such as these, the hotel has experienced a sell out as airlines seek housing for their stranded passengers and delayed ?ight crews.
1) Should the hotel's RM immediately revise their demand forecast and also eliminate the heavy discounts on the rooms remaining to be sold on this Sunday night?
2) Should they make any changes to their rate (and if so, how much?)
3) Do you feel any ethical issues are in play in this scenario? Explain your answers.
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