Imagine, Unexpectedly, a Tour Operator Seeks to Book 100 Rooms

Imagine, unexpectedly, a tour operator seeks to book 100 rooms at a 180 room hotel for $80 per room on 15^th May. Rooms normally sell for $120. Forecasts indicate that without this incremental group booking, the hotel would sell 140 rooms at $120 each on 15^th May.
Which of the following statements is untrue:

A) The decision to provide the tour operator with the 100 rooms at $80 will have the impact of increasing revenue for the year by $800.
B) Selling the rooms to the tour operator is justified as the increased occupancy will more than off-set the discounted pricing of the rooms.
C) Application of a revenue management philosophy could result in the tour operator being offered the 100 rooms at $78 each on a different night.
D) Application of a revenue management philosophy could result in the tour operator being encouraged to make the 15^th May booking for less than 100 rooms.
E) Application of a revenue management philosophy would result in the rooms not being sold to the tour operator.

Correct Answer:

Verified

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