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Suppose a hotel has annual fixed costs applicable to its rooms of $2.5 million for its 250-room hotel. Average daily room rents are $65 per
Suppose a hotel has annual fixed costs applicable to its rooms of $2.5 million for its 250-room hotel. Average daily room rents are $65 per room and average variable costs are $15 for each room rented. It operates 365 days per year. If the hotel is completely full throughout the year, what is net income for one year?
A) $1,275,000
B) $1,780,500
C) $2,062,500
D) $2,225,750
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