A guesthouse in Maun is considering a large expansion, adding twelve rooms, to be built during the low season. Evaluate whether the owner should go ahead.
8 marks · Evaluate · Evaluation and judgement questions
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Answer: Self-mark against the levels below: a decision is required, and the best answers make the decision conditional on something specific (for example, a signed contract with a tour operator for the shoulder months).
- Case for — twelve rooms at high season prices increases revenue; building in the low season avoids lost bookings
- Case against — a loan must be serviced through the low season, when the guesthouse is only half full, and the owner has no other income
- The specific risk — demand in the shoulder months is assumed, not evidenced
- Decision — proceed only if off-season demand is confirmed in advance (contract with an operator, or a smaller first phase), otherwise the loan is the danger rather than the building
Write the decision in the first line of your final paragraph, then justify it. Markers look for the judgement, and a judgement buried at the end of a long sentence can be missed.