The Marriott Hotel in Central has 100 rooms available for Dec 31. There are two types...
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The Marriott Hotel in Central has 100 rooms available for Dec 31. There are two types of customers, business custo mers and leisure customers. Marriot charges a high rate of $300/night and a low rate of $120/night. High-rate guests do not need pre-booking and has time flexibility; low-rate guests need pre-booking. Assume business customers alw ays take the high rate option and leisure customers always take the high rate option and leisure customers always tak e the low rate option. Leisure customers always book far earlier before business customers and there are sufficient le isure customers. The total number of business customers is uncertain and its demand distribution is given in the follo wing table: Number of business customers Probability 56 0.06 57 0.08 58 0.12 59 0.14 60 0.2 61 0.16 62 0.14 63 0.1 Suppose there is another hotel (Hotel B) nearby Marriott. Hotel B has ample rooms and there is always a room avail able for walk-in customers. If there is no available room for walk-in customer in Marriott, the customer can be divert ed to Hotel B and the two hotels share the revenue from the diverted customer. Specifically, the diverted customer p ays $300 to Hotel B; Marriott gets $80 as a referral fee and Hotel B keeps the remaining $220. In this scenario, how many rooms should be protected for business customers in Marriott? The Marriott Hotel in Central has 100 rooms available for Dec 31. There are two types of customers, business custo mers and leisure customers. Marriot charges a high rate of $300/night and a low rate of $120/night. High-rate guests do not need pre-booking and has time flexibility; low-rate guests need pre-booking. Assume business customers alw ays take the high rate option and leisure customers always take the high rate option and leisure customers always tak e the low rate option. Leisure customers always book far earlier before business customers and there are sufficient le isure customers. The total number of business customers is uncertain and its demand distribution is given in the follo wing table: Number of business customers Probability 56 0.06 57 0.08 58 0.12 59 0.14 60 0.2 61 0.16 62 0.14 63 0.1 Suppose there is another hotel (Hotel B) nearby Marriott. Hotel B has ample rooms and there is always a room avail able for walk-in customers. If there is no available room for walk-in customer in Marriott, the customer can be divert ed to Hotel B and the two hotels share the revenue from the diverted customer. Specifically, the diverted customer p ays $300 to Hotel B; Marriott gets $80 as a referral fee and Hotel B keeps the remaining $220. In this scenario, how many rooms should be protected for business customers in Marriott?
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