Treynor Pie Company is a food company specializing in high-calorie snack foods. It is seeking to diversify its food business and lower its risks. It is examining three companies—a gourmet restaurant chain, a baby food company, and a nutritional products firm. Each of these companies can be bought at the same multiple of earnings. The following represents information about all the companies. Company Correlation with Treynor Pie Company Sales ($ millions) Expected Earnings ($ millions) Standard Deviation in Earnings ($ millions) Treynor Pie Company + 1.0 $ 197 $ 9 $ 4.0 Gourmet restaurant + 0.6 64 4 1.3 Baby food company + 0.3 54 2 1.8 Nutritional products company − 0.7 75 3 3.2 a-1. Compute the coefficient of variation for each of the four companies. (Enter your answers in millions (e.g., $100,000 should be entered as ".10"). Round your answers to 3 decimal places.) a-2. Which company is the least risky? Nutritional products company Baby food company Treynor Pie Company Gourmet restaurant a-3. Which company is the most risky? Baby food company Nutritional products company Gourmet restaurant Treynor Pie Company b. Which of the acquisition candidates is most likely to reduce Treynor Pie Company's risk? Gourmet restaurant Nutritional products company Baby food company

Suppose that you are responsible for making arrangements for a business convention and that you have been charged with choosing a city for the convention that has the least expensive hotel rooms. you have narrowed your choices to Atlanta and Houston that are consistent with the results reported by Smith travel research. Because considerable historical data on the prices of the rooms in both cities are available the population standard deviations for the prices can be assumed to be $20 in Atlanta and $25 in Houston. Based on the sample data, can you conclude that the mean price of a hotel room in Atlanta is lower than the one in Houston.

The management of 50-room Gordion Hotel, which has single and double rooms only, has acquired the following internal financial data: • Occupancy of 65.00% • Projected after-tax average daily room rate (ADR) of $54.00 • 25.00% of double room occupancy • A price difference of $15.00 more for double rooms than the singles Based on the financial information given, calculate the individual ADRs for single and double rooms for Gordion.

The operation team of H hotel, which has 25 rooms on daily basis, has projected that the occu-pancy will be 60.00% with total revenue of $620,000 and total expenses of $50,000 for the next year. The income tax bracket is 40.00%. Assume that there are only single and double rooms for H with a double occupancy of 70.00% and the double rooms are sold at a percentage markup of 20.00% over singles. Based on the information given, what are the individual average daily room rates (ADRs) for both single and double rooms for H hotel for the next year (assume that there are 365 days in a year)?

- Two hotels that are in different markets and do not compete with one another noted the following data during a recent year:

 Hotel E-Z Sleep
o When the nightly rate was $135 per room, 700 rooms per

month were rented
o When the nightly rate was increased to $165 per room, 600

rooms per month were rented

 Hotel Nice Night
o When the nightly rate was $200 per room, 800 rooms per

month were rented
o When the nightly rate was increased to $300 per room, 500

rooms per month were rented - Do the following for each hotel:

•  Calculate the price elasticity of demand using the midpoint method

•  Calculate total revenue before and after the price change

•  Determine whether demand is inelastic, elastic, or unitary elastic

•  Was increasing price the right thing to do?

•  What are some other factors that may have influenced the data?

•  Should the hotels consider increasing the price in the future?

PLEASE ANSWER ALL QUESTIONS !

1. Gwen suspects fraud is occurring at a hotel she manages. Historically, each of her hotels spends $8,250 per month in maintenance expenses with a standard deviation of $1,070. At the suspect hotel, the last 31 months have averaged $8,490 in maintenance expenses. Gwen thinks the hotel is spending significantly more than the others. Use the 10% significance level.

Calculate the value of the test statistic.

Select one:

a. 0.87

b. 0.89

c. 1.36

d. 1.25

e. 1.54

2. Harley is working as a waiter at a restaurant while paying his way through school. The manager told him he could expect $95 per night in tips with a standard deviation of $30. However, after 32 nights he is averaging only $85 in tips. He wants to know if this is significantly different at the 5% significance level.

Calculate the value of the test statistic.

Select one:

a. -2.06

b. -1.61

c. -1.89

d. -2.26

e. -2.64

On January 3rd, 2009 Holiday Inn Hotels entered into a contract with Great Designs Inc., an interior decorating firm, to have their hotel rooms re-decorated with new carpeting, bedspreads, curtains and wall art. Holiday Inn Hotels paid Great Designs Inc., $100,000 upfront and the work was to be completed by June 1st, 2009. On June 1st, 2009 work in 30% of the rooms was still not complete. The Hotel had a large conference group checking in on June 30th, 2009 that would result in all the rooms being occupied. The Hotel, therefore, terminated its contract with Great Designs Inc., and hired a different designer to finish the work. The new designer completed the work on June 30th, 2009 at an additional cost of $15,000. Answer the following questions:

1. Did Holiday Inn Hotels act correctly in discharging its contract with Great Designs Inc.? Explain.

2. Assuming that Holiday Inn Hotels did properly terminate Great Designs Inc., to what amount of damages is Holiday Inn Hotels entitled? Explain.

STAT 13_2:

Each of the individuals in a particular population are:
-Mature man in probability 3.0
-Mature woman in probability 0.3
-Youth child in probability 0.3

It is known that the probability that an individual has an iPhone is:
-Of the adult men 0.4
- Of the older women 0.3
-Also, the probability that an individual in the population has an iPhone is 0.25.

1. A Youth is randomly selected from the population. What is the probability of having an iPhone?
2. A randomly selected individual from the population and found to have an iPhone and not a youth. What is the probability that this individual is a mature woman?
3. Are the events "Selected Mature Woman" and "Selected iPhone Owner" independent events? Explain

A movie theater company wants to see if there is a difference in the average movie ticket sales in San Diego and Portland per week. They sample 20 sales from San Diego and 20 sales from Portland over a week. Test the claim using a 5% level of significance. Assume the variances are unequal and that movie sales are normally distributed.

Choose the correct decision and summary based on the p-value.

• A. Do not reject H_0. There is evidence that the average movie ticket sales in San Diego and Portland per week differ.
• B. Reject H₀. There is no evidence that the average movie ticket sales in San Diego and Portland per week differ.
• C. Reject H₀. There is evidence that the average movie ticket sales in San Diego and Portland per week differ.
• D. Do not reject H₀. There is no evidence that the average movie ticket sales in San Diego and Portland per week differ.

A movie theater company wants to see if there is a difference in the average movie ticket sales in San Diego and Portland per week. They sample 20 sales from San Diego and 20 sales from Portland over a week. Test the claim using a 5% level of significance. Assume the variances are unequal and that movie sales are normally distributed.

Choose the correct decision and summary based on the p-value.

• A.

  Do not reject H_0. There is evidence that the average movie ticket sales in San Diego and Portland per week differ.

• B.

  Reject H₀. There is no evidence that the average movie ticket sales in San Diego and Portland per week differ.

• C.

  Reject H₀. There is evidence that the average movie ticket sales in San Diego and Portland per week differ.

• D.

  Do not reject H₀. There is no evidence that the average movie ticket sales in San Diego and Portland per week differ.

Please assist with the following question:

A home theater in a box is the easiest and cheapest way to provide surround sound for a home entertainment center. A sample of prices is shown here (Consumer Reports Buying Guide, 2004). The prices are for models with a DVD player and for models with a DVD player.

1

1. Compute the mean price for models with a DVD player and the mean price for models without a DVD player. What is the additional price paid to have a DVD player included in a home theater unit?

2. Compute the range, variance, and standard deviation for the two samples. What does this information tell you about the prices for models with and without a DVD player?

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