• The following information is for Winter Break Hotel. Given the information, questions from #14 to #16.
o Average room selling price: $65
o Average variable cost per room: $17
o Annual total fixed costs: $450,000
o Sales goal (= Net Income) of the hotel this year: $5,000,000
o Number of rooms available per day: 400 rooms
o This hotel is open 365 days a year.

What is the occupancy percentage required to reach the sales goal? (Round to the second decimal place.)

A. 23.43%

B. 9.46%

C. 23.65%

D. 77.77%

For every $1 of sales, how much can this hotel use to pay on fixed costs or to generate profits?

A. $2.82

B. $.82

C. $.26

D. $.74

If this hotel experiences an increase in its fixed cost by $35,000 this year, how many additional rooms must be sold to absorb this increase? (Round up to the nearest whole number.)

A. 730 rooms

B. 21,722 rooms

C. 727 rooms

D. 11,667 rooms

Hubbart approach

The Pimlico Hotel is a 200-room hotel and it is projected to cost $15 million including land, building, equipment, and furniture and working capital. The hotel is financed with a $10 million loan at 8% interest rate. The owner’s investment in the property is $5 million. The owners desire a 16% return on investment. The hotel projects 80% occupancy rate and it will be open 365 days a year. The income tax rate is 40%. Room’s department direct expenses

are $10 per room sold.

The following are the fixed and undistributed expenses.

Depreciation expense $300,000

Amortization expense 100,000

Rent Expense 130,000

Administration and general 300,000

Marketing 200,000

Utility costs 200,000

Property Operations and Maintenance 120,000

Insurance 50,000

Property taxes 200,000

Other operated departments’ Income/losses

Food 150,000

Beverage 50,000

Telephone (50,000)

Additional information

Double occupancy 40%

Rate difference (spread) between double and single is $10.

Using the information above find the ADR and determine double rate and single rate for the Pimlico Hotel.

Fun City has decided to build a new municipal water park with pools, water slides, and so forth. You have been hired to conduct a study to determine if the water park can pass the test. A nearby and very similar city currently has a water park similar to the one Fun City is considering. The nearby city currently charges $10 for admission and, on a typical day, attracts 4,000 persons. Last year, it charged $15, but only attracted 3,000 paying customers.

1. Assuming that the demand curve for water parks is linear, estimate the net benefits received by those using the Fun City water park, if Fun City charges an admission price of $12.50. [NOTE: You need not compute the actual amount; just use a graph and clearly indicate the area that represents the net benefit amount.]

2. By how much, and in what direction, would the net benefits received by those using the water park change if Fun City charges a $15.00 admission price, rather than $12.50? [NOTE: This time compute the actual dollar value.]

IN JAVA

Write a program that calculates the occupancy rate for each floor of a hotel. (Use a sentinel value and please point out the sentinel in bold.) The program should start by asking for the number of floors in the hotel. A loop should then iterate once for each floor. During each iteration, the loop should ask the user for the number of rooms on the floor and the number of them that are occupied. After all the iterations, the program should display the number of rooms the hotel has, the number of them that are occupied, the number that are vacant, and the occupancy rate for the hotel. Input Validation: Do not accept a value less than 1 for the number of floors. Do not accept a number less than 10 for the number of rooms on a floor.

SAMPLE OUTPUT:

Enter number of floors:
2
Enter total rooms at floor 1:
10
Enter total rooms occupied at floor1:
5
Enter total rooms at floor 2:
10
Enter total rooms occupied at floor2:
5
Total rooms: 20
Total occupied rooms: 20
Hotel occupany: 50.0

4. Mrs Garcia, a physics enthusiast, goes to a water park in South Padre Island to test the concepts learned during class. She goes on a water slide that is 265 meters long and is built at an angle with the ground of θ = 30 degrees. – What is her final velocity at the end of the slide?

5. A goalkeeper kicks a soccer ball that is initially resting on the ground. She kicks the ball with an initial velocity of 8 m/s. The initial angle between the ground and the trajectory of the ball is θ=27 degrees. – How long is the ball in the air? – How far does the ball travel? – How high does the ball go? Hint: Use equations of motion and the definition of range and maximum height for projectile motion.

6. Solve the following quadratic equations: 2x 2 + 6x + 1 = 0 (1) 4x 2 + 12x + 2 = 0 (2) 9x 2 − 4x + 12 = 0 (3) (x − 1) x + 3 + 3 (x − 1) = (4 − x) (x − 1)(x − 1) (4) Hint: Factor and simplify using (x − 1).

(a) The daily demand for hotel rooms in Greater Toronto Area (GTA) is given by the equation: QD = 230–35P. The daily supply of hotel rooms GTA is given by the equation: QS = 13+19P. What are the equilibrium price and the quantity of hotel rooms? 6 marks

(b) Suppose the demand for a bushel of Corn in 2000 was given by the equation QD = 2550–166P. At a price of $4.46 per bushel, what is the price elasticity of demand? If the price of Corn falls to $4.27 per bushel, what happens to the revenue generated from the sale of Corn?

A hotel downtown is trying to implement an employee recognition program based on a standardized problem solving test. The company administering the test indicated that the scores are normally distributed with a mean of 82 points, and a variance of 16. The hotel has decided that employees who score in the bottom 7.5% of the test scores will not receive any additional benefits. The manager would like to know:

a. The probability that an employee would score between 70 and 78 points

b. What cutoff score on the test should the hotel use to not give any additional benefits?

AdventureParks Ltd is evaluating the construction of a new theme park. The theme park would cost $ 495 ​million, but would operate for 20 years. AdvertureParks expects annual cash flows from operating the theme park to be $ 70.6 million and its cost of capital is 12.0 %.

a. Prepare an NPV profile of the purchase.

b. Identify the IRR on the graph.

c. Should AdventureParks go ahead with the​ purchase?

d. How far off could​ AdventureParks' cost of capital estimate be before your purchase decision would​ change?

A Bacon Factory is located in a small town. Also in the town is a Water Park. The smell of the Bacon factory has adversely affected the Water Park such that it has put in air cleaning equipment to eradicate the odor created by the factory.

The cost function of the Bacon Factory is: CBF= B² + 4B^1/2 + (1 − x)²

where B denotes the quantity of bacon produced annually and x denotes the quantity of pollutants that A creates in a given year.

Thus, the Bacon Factory can limit production costs by eliminating its air scrubbers. However, the air pollution increases the costs for the water park W, whose cost function is: C_WP = W² + 2x where W denotes the number of visitors to the Water Park on an annual basis. Suppose that the unit price of admission to the water park is $3 and that the unit price of bacon is $32.5 per unit.

1. Compute the profit maximizing visits (represented by W) created by Firm W (assuming W behaves competitively in the output market). Notice that W does not choose x. Also, compute W’s profits.

2. Suppose now that the two firms B and W merge, creating B&W. The management of B&W now maximizes B&W’s profits by appropriately choosing x, B, and W. Find the quantities of Bacon, Water Park Visits, and pollutants that the new firm produces. Also, find the profits of B&W.