Question: Problem 2 : Hilton on Time Square, New York City, has 4 4 4 guest rooms. Hilton can sell all its hotel rooms at a
Problem : Hilton on Time Square, New York City, has guest rooms. Hilton can sell all its hotel rooms at a discounted price of $ per night to customers with a twoweek advanced purchase. Hilton can also sell its hotel rooms at its full price of $ per night to customers without advanced purchase. For any unsold hotel room, Hilton has a chance of selling it to some bidder from priceline.com at $ per night on the day before. The number of customers who buy at full price without advanced purchase can be or with equal probability. Answer the following questions.
What is the overage cost of a fullprice room?
What is the underage cost of a fullprice room?
How many rooms should Hilton reserve for the customers without advanced purchase?
What is the probability all fullprice customers will get a room?
What is the expected fraction of fullprice customers who get a room?
What are the number of expected sales of fullfare customers?
What is the number of expected sales of discounted customers?
What is the number of expected sales from priceline customers?
What is Hiltons expected revenue?
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
