Question

Last month, Ginger's hotel ran an occupancy rate of 85%. Her competitive set had 150,000 room nights included within it that were available for sale during that month. During that month, the competitive set sold a total of 115,000 rooms. What was the approximate occupancy rate INDEX last month for Ginger's hotel? Group of answer choices

Answer 1

111

Explanation:

-The occupancy rate index is calculated using the following formula:

`Index=(Hotel \ OCC)/(Competitive \ OCC)* 100`

-The Hotel OCC is the property's occupancy rate given as 85%

-The Competitive OCC, is the competitive set's occupancy rate calculated as;

`Occupancy \ Rate=(Room \ Sold)/(Rooms \ Available)\\\\\\=(115000)/(150000)\\\\=76.67\%`

-We then substitute to solve for the occupancy rate index:

`Index=(Hotel \ OCC)/(Competitive \ OCC)* 100\\\\=(0.85)/(0.7767)* 100\\\\=110.86\\\approx 111`

Hence, the occupancy rate index is 111