Chapter 05, Supplemental Question 08 (GO Tutorial) Value Lodges owns an economy motel chain and is considering building a new 200-unit motel. The cost to build the motel is estimated at $6,300,000; Value Lodges estimates furnishings for the motel will cost an additional $680,000 and will require replacement every 5 years. Annual operating and maintenance costs for the motel are estimated to be $240,000. The average rental rate for a unit is anticipated to be $25/day. Value Lodges expects the motel to have a life of 15 years and a salvage value of $900,000 at the end of 15 years. This estimated salvage value assumes that the furnishings are not new. Furnishings have no salvage value at the end of each 5-year replacement interval. Assuming average daily occupancy percentages of 50%, 60%, 70%, and 80% for years 1 through 4, respectively, and 90% for the 5th through 15th years, a MARR of 9%/year 365 operating days/year, and ignoring the cost of land, should the motel be built? Base your decision on an annual worth analysis. AW (in thousands) Note: Represent all dollar amounts in thousands (in k$), for example for $680,000 use 680 and provide answer in the same format. (Do all calculations to 5 decimal places and round final answer to nearest whole dollar (in thousands). Tolerance is +/ 10.) Click here to access the TVM Factor Table Calculator SHOW HINT GO TUTORIAL LINK TO TEXT Question Attempts: 0 of 2 used