ECN 102 Lecture Notes - Lecture 11: Statistical Inference, Regression Analysis

Suppose the hotel in the lecture example raised its price from $30 to $30.50. With the new price, the hotel expects 96 guests to arrive 5% of the time, 97 guests 10% of the time, 98 guests 20% of the time, 99 guests 30% of the time, 100 guests 25% of the time and 101 guests 10% of the time. The variable costs per occupied room and overbooking costs are the same as in the lecture.

Calculate the expected revenue, expected variable costs and expected costs from overbooking. 0

Using marginal analysis, should the hotel raise its price? Explain your answer.

What types of economic relations do managers take an interest in? Give examples and explain why they are interesting to managers.

TEXTBOOK

Managerial Economics: Foundations of Business Analysis and Strategy, 10/e

ISBN: 0073375918 Copyright year: 2011

NOVEMEBER 2018

Go to the Bureau of Economic Analysis (Links to an external site.)Links to an external site. (BEA) website and look at quarterly data from the last few years of the National Accounts. Can you make a decision of what part of the business cycle the U.S. economy is currently in? Why? What factors lead you to this conclusion? You may want to do additional research of sources to reach a conclusion. If so, please identify the sources that added to your analysis.

http://www.bea.gov/