In my town, a cheap motel is $400 a week.  A room with 2 beds and a bathroom.  The nicer hotels (pool, gym, free breakfast) are about $700 a week.

I charge $200/week per person, because that is their budget with their per diem.

Why do you charge so much less than what you refer to as "a cheap" option?

People with a per diem can't afford the $700 hotel.  $200 a week is in their budget.