Andy Jones is a Revenue Manager in the West Coast Hotel. His 220-room property normally sells 85 percent of its rooms on Friday nights at an ADR of $141.50. He received a request from a group to block 125 rooms for a Friday night next week at a rate of $109.02 per room. Andy believes that if the hotel accepts this request, the transient room sales for that day will ensure a sell-out at the rate of $141.50.

Let's practice the revenue management:

1.

- What would be the amount of rooms' revenue the hotel will achieve if it makes the group sale? Show the calculation and round to hundredth of decimal.

- What would be the amount of rooms' revenue the hotel will if it does not make the group sale? Show the calculation and round to hundredth of decimal unless the result naturally rounds up to a whole number or tenths of decimal.

2. Should Andy accept the group request based just on the amount of rooms' revenue?

3. Based on what we studied in the course so far, what additional factors might Andy take into account before determining whether to accept this group's request?