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What equivalent occupancy percentage must be achieved

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Question 1: The Prancing Pony Inn, a 100-room hotel, currently operates at 75.00% occupancy, a rack rate of $60.00, and a marginal cost of $8.00 per room. The management of the Prancing Pony Inn is considering discounting the rack rate by both 10.00% and 20.00% so that they can increase the occupancy. What equivalent occupancy percentage must be achieved to maintain the same levels of room contribution margin for both 10.00% and 20.00% discount levels (assume that marginal cost will remain the same for the two discount situations)?

Reference no: EM132537093

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