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Business
Operations Management
Harrison Hotels is considering adding a spa to its currentfacility in order to improve its list of amenities. Operating thespa would require a fi xed cost of $25,000 a year. Variable cost isestimated at $35 per customer. Th e hotel wants to break even if12,000 customers use the spa facility. What should be the price ofthe spa services?

Harrison Hotels is considering adding a spa to its currentfacility in order to improve its list of amenities. Operating thespa would require a fi xed cost of $25,000 a year. Variable cost isestimated at $35 per customer. Th e hotel wants to break even if12,000 customers use the spa facility. What should be the price ofthe spa services?

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Harrison Hotels is considering adding a spa to its current
facility in order to improve its list of amenities. Operating the
spa would require a fi xed cost of $25,000 a year. Variable cost is
estimated at $35 per customer. Th e hotel wants to break even if
12,000 customers use the spa facility. What should be the price of
the spa services?

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