Cleveland Hotel has been offered a contract by a convention planner to reserve a block of 30 rooms for 365 nights at a reduced rate of $60 per night. Cleveland Hotels usual room rate is $120 per night. When a local sports team is in the playoffs, the rooms can sell for $150 per night.

a. Compute the opportunity cost of accepting the contract on a usual night when 15 of the rooms would normally be occupied.

b. Compute the opportunity cost of accepting the contract in a playoff night when all of the rooms would normally be occupied, assuming all the rooms would have been occupied.

c. Using the usual room rate of $120, what percentage of rooms would have to be rented to make Cleveland Hotel indifferent about accepting the offer?