Explanation

Reading the question: although the question stem isn't really phrased as such, the prompt has the structure of an "explain" question. There are two facts seemingly in contradiction, and we must choose the statement that accommodates and reconciles them.

Creating a filter: How could 1) a 3% increase in capacity be sufficient when 2) room bookings go up 25%? Supposing that we don't have a prediction, we can turn to the answer choices and look for choices that don't contradict the facts and address both 1) and 2).

Applying the filter: choice (A) contradicts the prompt; the whole point is that we won't have to turn anyone away. Same with (B): room bookings are supposed to go up 25%, not just visitors, so (B) is either contradictory or irrelevant. Choice (E) is irrelevant to the comparison of demand and capacity in the hotel rooms.

Logical proof: so we're left with (C) and (D). We can examine cases to elucidate what they mean and which is correct. Choice (D) would be wrong if we were told that the peak booking or simultaneous booking is up 25 percent... but we are not told that. Does (C) have a problem? Yes, it does: we are talking about room bookings, not the number of people. So (C) is actually irrelevant; it can be true and the number of room bookings is still going up 25%. So the explanation is that capacity doesn't need to grow as fast as the bookings because the bookings will show up at times with excess capacity, not the busy times. The correct answer is (D).