Question: PROBLEMS P13.1 There are five competitive motels in a resort area with the following num- ber of rooms and current occupancy rates: Motel Rooms

PROBLEMS P13.1 There are five competitive motels in a resort area with the following num- ber of rooms and current occupancy rates: Motel Rooms A 74 82% B 45 73% C 58 85% 48- 70% E 52 75% 71 Demand for rooms in the area is broken down into the following sources and growth rates: Percentage Growth Rate &Source Business traveler 10 5% Vacation traveler 80 8% Other travelers 10 1% 26 a. Calculate the current average occupancy of the five motels. b. Calculate the composite rate of growth in demand. c. Apply the composite growth rate to the demand figures to obtain pro- jected demand for each of the next 4 years. d. Assume that a 70% average room occupancy for the motels in this re- sort would be profitable. Calculate the future supply of rooms that could be supported for each of the next 4 years.

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