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A Hotel Finds That If It Spends No Money on Renovations

question 45

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A hotel finds that if it spends no money on renovations they will be able to rent 135 rooms per night. However they have found that for every $4000 spent on renovations they will be able to rent an additional 30 rooms per night. Let x represent the amount of money spent on renovations and y represent the number of rooms rented. Determine a model for the number of rooms rented as a function of the amount of money spent on renovations.

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Definitions:

Materials Variance

The difference between the actual cost of materials used in production and the expected (standard) cost of those materials.

Price Variances

The difference between the actual cost of a good or service and its standard or expected cost, which can be favorable or unfavorable.

Quantity Variances

Differences between the actual quantity of materials or inputs used in a production process and the standard quantity expected to be used, often leading to cost variances.

Favorable Variance

A financial situation where actual costs are less than the standard or budgeted costs, or actual revenue is higher than expected.

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