Hospitality Managerial Revenue Management

Revenue Management (7 points) a. (1 points) A hotel has 2 rooms left to sell for November 17th through 21th. The variable cost of selling a room for one night is $24. Customers A, B, C and D wants to check in at the hotel on October 12th and stay for 2, 3, 3, and 3 nights respectively and is willing to pay $210, $140, $100 and $90 per night respectively. Customer A and B plans to use the hotel's breakfast buffet every morning of their stay, but none of the other customers plan to have their breakfast at the hotel. The buffet costs $17 per person and the variable cost for the buffet per person is $6. Which customer(s) would you accept? Explain why. b. (3 points) A hotel has 155 rooms and forecasts to sell 145 transient rooms at $95 each on average on December 1st? A group wants 40 rooms at the rate of $60 for one night orn December 1st and promises F&B revenue of $200. For the hotel, the variable cost of selling a room is S45 and the variable cost percentage for F&B is 65%. On average, the hotel transient customers spend $10 per customer per day o n F&B during their stay at the hotel. Should the hotel accept this group request? Why or why not? Support your answer by showing your calculations (3 points) (Continuing from question # b) Before the hotel manager could communicate her/his acceptance/turn-down decision to the group, the group coordinator calls and says that the group actually needs 99 rooms, instead of 40 rooms, and inquires how much the group should pay per room in order to book the group at the hotel. The group's F&B revenue is to remain the same. What would be the minimum rate the hotel should charge the group? Show your calculations c