A 100 room hotel was projected to cost $10,000,000.

The hotel would have fixed annual costs of $2,000,000 and an overall Net Income margin on variable costs (only) of 63%.

The market portion of the feasibility study indicated that the REVPAR for this market was projected to be $82.50 in year 1, $85.00 in year 2, and $87.00 in year 3.

Is this hotel a feasible investment over this three year period? Show your calculations.