Accommodations in Japan come with several options. There is Western style hotels (Intercon, Marriot, Hyatt, etc), Japanese own hotels (Hoshino星野), capsule hotels, temple lodgings, themed hotels, hostels, Minshuku, and Ryokan. Ryokan is a traditional Japanese style inn with Japanese style rooms (tatami floor and futon beds). Typically, accommodation comes with dinner and breakfast either at a dining area or in your room. Japanese haute cuisine 懐石料理 is served so guests can experience a traditional Japanese lifestyle. This is a slightly more high end option but totally worth the money.
Read about the food in detail in this post. How is it more expensive? Unlike normal hotels which charges room with 1 fixed price regardless the numbers of occupants in room, Ryokan charges per person and has a limitation on how many guests per room. So, let's say on a Ryokan's website, it says 38,500 yen ($360usd), that's "starting price per person". Move curser to desired room type, it shows the actual price based on headcount. Ryokan usually offers discount on children based on age. Besides booking a room, you also need to select meal options. There's basic menu and options to upgrade ingredients, such as A5 Wagyu (worth it).
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