Question
Home Sweet Home, a 50-room hotel, currently operates at 52.00% occupancy. Total rooms revenue generated from the room sales is $15,600 with a marginal cost
Home Sweet Home, a 50-room hotel, currently operates at 52.00% occupancy. Total rooms revenue generated from the room sales is $15,600 with a marginal cost of $90.00 per room. The management is considering discounting the rack rate by 15.00% so that they can increase the occupancy. What equivalent occupancy percentage must be achieved to maintain the same levels of total room contribution margin level per room with the discount in the rack rate (assume that marginal cost will remain the same for the discount situation)? Group of answer choices 63.14% 75.56% 68.70% 71.30%
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