Question

Peter is the owner of a hotel. He has found that when he charges the nightly cost of $139, the average occupancy is 275. In addition, Peter has found that with every $10 increase in the average nightly cost, the hotel occupancy decreases by an average of 22.

Which of the following functions describes the hotel's profit in terms of x, the number of $10 increases over $139?

Answer 1

Without price increase, Cost/night = $119

Average occupancy = 372 The revenue will be 119*372 = $44,268

For every $15 price increase, the occupancy decreases by 25. Therefore with x price increases, The revenue will be $(119 + 15x)*(372 25x)

Cost/night = $119 + 15x Occupancy = 372 - 25x

Answer:

The nightly cost with x $15 price increases is $119 + 15x.