Revenue Management at Harrah’s
Entertainment, Inc.
Narendra Agrawal
Department of Operations and Management Information Systems, Leavey School of Business,
Santa Clara University, Santa Clara, California 95053, nagrawal@scu.edu
Morris A. Cohen, Noah Gans
Operations and Information Management Department, The Wharton School, University of Pennsylvania,
Philadelphia, Pennsylvania 19104 {cohen@wharton.upenn.edu, gans@wharton.upenn.edu}
D
istribution: To maintain the integrity and usefulness of cases published in ITE, distribution of this teaching note to any other party is prohibited. Please refer interested instructors to ITE for access to the teaching note.
Section 1, below, contains the suggested case questions. Section 2 provides some background on the case questions, as well as sample answers. Section 3 systematically walks through HarrahsInstructionSpreadsheet.xls, which is one of the two supporting files1 included in this Teaching Note (TN):
HarrahsCaseData.xls—supporting data for the case analysis, which can be distributed to students.
HarrahsInstructorSpreadsheet.xls—spreadsheet that includes case data, a bid-price linear program (LP), and a Crystal Ball Simulation that allows the user to simulate revenues associated with a given set of bid prices. 1.
weekend and only the rooms in Table TN1 remain free. Now consider the list of 6 reservation requests that came in on August 15, as shown in Table TN2.
Using the clearing prices that were computed in
Table 8 in the Case, determine which customers should be offered a room and what prices they will
