If the hotel usually charges $250/night and it has 100 rooms, that's $25,000 in potential revenue that they get every night. Suppose the cost of buying the property and building (and upgrading) the hotel comes out to $10,000 per day over the life of the business, and the cost of staffing and servicing the hotel comes to $50 per occupied room per day. If only 50% of the rooms are occupied at the full price, then the hotel is generating $12,500 in revenue (half of $25,000) and expending $12,500 in costs ($10,000 + [50 rooms x $50]). The hotel is just breaking even.
If ten customers call the hotel at 7:00 PM and offer to take rooms for $100 each, this is a steep discount in the room price but generates another $1,000 in revenue at an additional cost of only $500 (10 rooms x $50). Why wouldn't the hotel jump at the chance to give those rooms away for $100 each?
You are absolutely right, the hotel should be free to give deep discounts to new customers once their primary customers pay most of the freight. In the hotel case, that might make sense if the hotel decided to give out empty rooms to the homeless. But Trump’s point is that you shouldn’t be giving that kind of break to a Saudi Prince.
Because that is what Amazon is in this case.