ERF Enterprises provides comprehensive AV services to institutions in the State of Colorado. Their customers fall into 3 categories - Hospitals, Schools and Hotels

ERF's Executive Vice President of Operations, Jennifer Murray, has noted that the Hotel business, while profitable, seems to take a lot of ERF's support resources

Ms. Murray has asked for your support in getting a better picture of the profitability of each of the 3 lines of business

She provides the following data on the support activities of ERF for a 12-month period

The average support-resource consumption by category is provided below:

Excluding the cost of support, the average profitability of each category is given below:

Q1. Provide Ms. Murray with a an activity-based analysis of the profitability of each category of customer

Q2. After reviewing the data and analyses, what advice may be given to service personnel to improve profitability of the category with the lowest profit (after support cost)?

Is there some unusual explanation for high activity levels which could be further investigated? What creative questions could be asked?          

5.Contrast the level of security in a hotel that uses a hard-key system with that in a hotel that uses an electronic key or smart card system.

Exercise 1-4. Information Age [LO 4]

The Wellington Hotel is a posh hotel in Manhattan that uses a customer relationship management (CRM) system to track customer preferences and purchases.

Provide two examples of specific information the CRM system might capture and how the hotel could use the information to enhance revenue and/or the customer experience.

A survey of 1935 people who took trips revealed that 181 of them included a visit to a theme park. Based on those survey results, a management consultant claims that less than 10 % of trips include a theme park visit. Test this claim using the ?=0.01 significance level.

(a) The test statistic is

(b) The P-value is

(c) The conclusion is  

A. There is not sufficient evidence to support the claim that less than 10 % of trips include a theme park visit.
B. There is sufficient evidence to support the claim that less than 10 % of trips include a theme park visit.

Problem 2

The Manager at Brackley Fun Park advertises that the typical family visiting the park spends at least one hour in the park during weekends. A sample of 35 visitors during the weekends in the month of July revealed that the mean time spent in the Park was 62 minutes with a standard deviation of 8 minutes.

1. Using the 0.01 significance level and a one-tailed test, is it reasonable to conclude that the mean time in the Park is greater than 60 minutes? Show all steps in your test of hypothesis.
2. Repeat the analysis at the 0.05 significance level. (You may show only the calculations that change).
3. Repeat with a survey mean of 65 minutes at the .01 significance level. (You may show only the calculations that change).
4. What do you conclude from your analysis?

Use SPSS to get the appropriate output, and please explain the process. Along with providing the SPSS output, use the 5 steps of hypothesis testing to analyze the results by using the p-value approach. 6. Create an SPSS file with the variable names Hotel and Inspection. In the Hotel column, enter the value 1 in the first 25 cases and the value 2 in the next 30 cases. Then, in the Inspection column, enter the value 1 for any four cases of Hotel 1 and 0 for the rest of the Hotel 1 cases. And, enter the value 1 for any 10 cases of Hotel 2 and 0 for the rest of the Hotel 2 cases. For the inspection variable, 1 = a room failed inspection & 0 = a room passed inspection. a) Run a binomial test on for H0: π≤ 0.1 versus H1: π > 0.1 Test at 0.05 level of significance. b) Run a chi‐square test on H0: π1 – π2 = 0 versus H1: π1 – π2 ≠ 0 Test at 0.05 level of significance.

Assuming you will speak to 30 people attending a conference, if there is a 28% chance they are staying in the hotel hosting the conference. Find the following binomial probabilities.

• First is to increasing the market:

The marketing is the building block of any company. this to let people know about your company its mean that the customer wants to know about the company history and try to understand about the company. however, they want to know what were company focus on. to create them familiar with the poster , social media marketing or advertising so that the customer will know about the company poster that has compliment and company expectation in the reality so that the customer what they do believe and also the customer can see trough online the company poster and to gain more follower .

• Second is make USP:

In every company hospitality service were only use USP to become successful and to gain more profit. However that USP can make more easier to the hotel so that they can research the target of audience and to offer some product of the benefit that customer needs then USP also can the highlight of uniqueness and strong brand image of hotel so that the customer can enjoy the unique of the hotel and by following the trend but it also protect the good brand image of hotel that has good service and quality . but this can be help marketing strategy of hotel that has lack of vision can be defining into single point and to branches out the hotel market.

Then to set up some goal for employee so that the employee can provide with good service to their customer and to gain trust from the customer. so that they must responsible to hold their role and to guide the promise of USP. But USP also can give a premium rate so that the hotel will charge the price the customer so that they will pay great deal for to get memorable and experience in the hotel. However, to build a loyal customer so that the hotel will offer with fulfil service to their customer and to differentiate the loyal customer from other competitor that didn’t have to maximum the revenue and delivering unique of selling proportion to their customer.

• The last is the : to introducing the effective schemes for the customer

To implement with different scheme that can make to attract to the customer that were giving promotion, packet, coupon, discount, and etc. that too people who were often visit to the hotel this reward system were doing in every hotel that those were often to visit to the hotel and to build loyal to the customer . but the hotel will give good offer the customer so that they will have good deal what they pay offer and also that the hotel will give them a hotel facility for free to access that they were pay for. Even though some visitor will get some experience to check in the hotel by using online booking and asking some question for during stay, are you having a comfortable to stay? do you require any assistance? well this question to establish to gain trust for their guest and to show care about their guest. to use advance technology so that the customer will more easier to check in by them sleeve and to see what is the hotel offering to their guest . try to understand the different level of customer expectation and satisfaction. to quick resolve problem with their facilities and to get feed back by guest this feed back is important to company image and to service their customer service performance with excellent so that the company can get a positive feed back from their guest and to gain more follower . then to keep in touch with customer that who barely visit by thought email .

a. Refer to Dave McClure’s pirate metrics, explain each and every point of the metrics of your innovation.

Watta Corporation is a debt-free company with a company beta of 1.30 at a time when the risk free rate is 2 percent and the market risk premium is 5 percent. Although the company has two divisions with different risk levels, the CFO is currently using the company’s overall WACC as the hurdle rate for all projects. Watta’s home furnishings division has a divisional beta of 0.75 and its ammunition division has a divisional beta of 1.5. The home furnishings division has identified two projects with expected returns of 5.50 percent and 8.4 percent. The ammunitions division has identified two projects with expected returns of 8.6 percent and 9.2 percent. Draw a graph of the security market line. On the same graph, include a line for the company’s WACC and place an “x” in the appropriate position on the same graph for each of the four projects. Using the CFO’s criteria, which of the projects will be accepted? Which of the projects should NOT be accepted if analyzed properly?

Problem 26-01
Investment Timing Option: Decision-Tree Analysis

Kim Hotels is interested in developing a new hotel in Seoul. The company estimates that the hotel would require an initial investment of $16 million. Kim expects the hotel will produce positive cash flows of $2.72 million a year at the end of each of the next 20 years. The project's cost of capital is 12%.

1. What is the project's net present value? A negative value should be entered with a negative sign. Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to two decimal places.
   $ million
   
2. Kim expects the cash flows to be $2.72 million a year, but it recognizes that the cash flows could actually be much higher or lower, depending on whether the Korean government imposes a large hotel tax. One year from now, Kim will know whether the tax will be imposed. There is a 50% chance that the tax will be imposed, in which case the yearly cash flows will be only $1.44 million. At the same time, there is a 50% chance that the tax will not be imposed, in which case the yearly cash flows will be $4 million. Kim is deciding whether to proceed with the hotel today or to wait a year to find out whether the tax will be imposed. If Kim waits a year, the initial investment will remain at $16 million. Assume that all cash flows are discounted at 12%. Use decision-tree analysis to determine whether Kim should proceed with the project today or wait a year before deciding.
   -Select-It makes sense to proceed with the project today.It makes sense to wait a year before deciding.