Jerry Wills is considering a franchise with Quality Inns. Assume the lodging operation will have 200 guest

Question:

Jerry Wills is considering a franchise with Quality Inns. Assume the lodging operation will have 200 guest rooms. Assume an average annual occupancy of 70% and an ADR of $80.

Note: See Exhibit 16-3.

Required:

1. Determine the initial fee.

2. Calculate the total royalty fees for a year.

3. Calculate the total advertising /marketing fees for a year.

4. Determine the total reservation fees for a year.

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