Hotel Bethlehem implements a block pricing scheme for nights in a hotel room. They face inverse demand
P = 260 -QD
The marginal cost of having a guest in a room is $20.
a. If Hotel Bethlehem can charge two separate prices for two separate blocks of guests, what are the two prices they charge? how many rooms do they ll at each price?
b. If Hotel Bethlehem only charges one price, how many rooms do they ll? What price do they charge for those rooms?
c. Compare your answers in part a. and part b. Which is more protable for Hotel Bethlehem?