What is hubbart formula?

this formula is meant for setting up rates for rooms of hotels when the hotel is still to be opened or is renovated. hubbart formula is a formula being invented by Mr. Roy hubbart the chair person for the committee being appointed by American hotel and motel association for developing a method compute room rates. in 1952 he gave the following formula:> the rates can be computed if:

1. an estimation is made for the number of guest rooms to be sold per year.

2. a tabulation is made for the cost of operation

3. an amount representing the estimated fair return on investment is added to the cost of operation

the average rate must to be charged is than calculated by following formula:

Mandeep Singh