Hospitality Revenue Management Final Exam 100% VERIFIED ANSWERS 2024/2025 CORRECT, Exams of Business Administration

Download Hospitality Revenue Management Final Exam 100% VERIFIED ANSWERS 2024/2025 CORRECT and more Exams Business Administration in PDF only on Docsity! Hospitality Revenue Management Final Exam 100% VERIFIED ANSWERS 2024/2025 CORRECT Most of the entities below are classified as "Chains". Which one is a "Parent Company" consisting of multiple chains? Accor Hotels Which is a true statement about Parent Companies? Parent Companies and the related chains have changed over time What are the three different operation types? Chain Management, Franchise, Independent Which is a true statement about Management Companies? Management companies have contracts where they receive payment for their services and/or some portion of profits Which is a true statement regarding geographic categorization? STR uses the UNWTO definitions when it comes to recognizing countries Which two geographic categories are the most important for a hotel GM? Market and Submarket Markets and Submarkets are created based on what two determining factors? Number of hotels and participation Which is a true statement regarding Submarkets A submarket may represent a small city in a rural market How many Scale categories are there compared to Class categories? 7 Scale categories and 6 Class categories Which one of the following is an accurate statement regarding Scale and Class groups and a single chain? A Ritz Carlton hotel will always be in the same Scale and Class groups in every country throughout the world The four key considerations when creating a Competitive Set are? Participation, Proximity, Pricing and Product The definitions for Supply, Demand and Revenue used by STR and others in the lodging industry are taken from what source? Uniform System of Accounts for the Lodging Industry Which is true regarding the type of performance data (Supply, Demand, Revenue) that STR receives? Daily and monthly only You receive your monthly STAR and find that it includes weekday and weekend performance, what days are included in "weekday" in most parts of the world? Sunday thru Thursday In which of the following situations will occupancy increase? Supply decreases 10% and demand decreases 5% Which statement is true regarding RevPAR? It can be thought of as a combination of Occupancy and ADR Use the spreadsheet below to answer Question 17. The March YTD Occupancy (E5) is _______. The Competitive Set Report in a Monthly STAR Report shows what information? 18 months of monthly data and 3 years of YTD, Running 3-month, and Running 12-month data Using the information from an excerpt of a sample "Competitive Set Report" page from a Monthly STAR Report, answer the following Question 36. Which of the following statements best describes performance of your hotel over the last six months? Your hotel's Occupancy Rank has consistently been 2 of 5 Which is an accurate statement regarding the Day of Week and Weekday/Weekend tab in the Monthly STAR report? All of the above Using the information from an excerpt of a sample "Day of Week and Weekday/Weekend Report" Page from a Monthly STAR Report, answer the following Question 38. Based on the information provided above, which one of the following is an accurate statement? The Weekend Occupancy for your hotel is consistently higher than your Competitive Set for all time periods The "Weekly Performance At A Glance" tab on the Weekly STAR report displays what information? All of the above The "Daily Data for the Month" tab on the Weekly STAR report displays what information? All of the above are displayed on this report Using the information from an excerpt of a sample "Daily Data for the Month" page from a Weekly STAR Report, answer the following Question 41. Based upon the first nine days of the month, what can you determine about your hotel's Occupancy performance? The Competitive Set's Occupancy was significantly below your hotel's occupancy for the first three days of the month Which of the following is a rule related to requesting Trend report(s)? All of the above are rules related to requesting a Trend Report Trend reports are available in which currency? Any currency Using the sample "Supply Summary" page from a Pipeline Report, answer the following Questions 44 and 45. Which one of the following is an accurate statement regarding Supply growth over the last 5 years? The Upscale segment experienced a significant increase in supply Which two chain scales will probably experience the largest Supply growth in the near future? Upscale and Upper Midscale Which is a true statement regarding the Changes to Existing Supply tab of a Pipeline Report? All of the above are true statements A HOST or Profitability report displays what type of information? Profit and Loss information, including revenue, expenses and profit accounts The HOST Report displays data based upon what time period? Annual Which is NOT a true statement regarding a Destination Report? Reports are available on a monthly basis, but not weekly What statement is true about a Multi-Segment tab of a Destination Report? All of the statements above are true Historically, what concept have hospitality managers chiefly used to calculate their selling prices? Costs What is an algebraic equivalent of the formula: Sales = Costs + Profit? Profit = Sales - Costs What element is not present in a barter economy? Money What is the formula used to calculate an owner's ROI? [Return on investment] Owner's Investment Return / Owner's Original Investment = Owner's Return on Investment Sandy has 100 hotel rooms to sell. This Saturday night has enough customers to sell 125 rooms so she will be refusing 25 requests for rooms. What is this an example of? Constrained supply What is the industry term used to describe the selling of rooms which are not actually available for sale? Overbooking Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hotel has 250 rooms. What was Tashia's occupancy % last night? 70% What is the industry term for the average revenue generated by each occupied guestroom during a defined period of time? RevPOR What is: Total period revenue? (Number of available seats) x (hours of seat availability) The formula for RevPASH What is the term used to identify a management philosophy that places customer gain ahead of short-term revenue maximization in revenue management decision-making? Customer-centric revenue management What is the term used to describe efforts undertaken to encourage travel and tourism to a specific geographic area or attraction? Destination marketing If quantity and price are held constant how will reductions in product or service quality affect buyers' perceptions of value? Perceived value will decrease If quantity and quality are held constant how will a reduction in price affect buyers' perceptions of value? Perceived value will increase Which of the Four I's of service refers to the fact that the quality of service often depends upon the skill level of the individual who supplies it? Inconsistency (variability) Which of the Four I's of service refers to the fact that services most often cannot be held, touched, or even seen before they are purchased? Intangibility Ahmed is the sole waitperson on duty at the Athenian restaurant during the very slow 2:00 p.m. to 4:00 p.m. time period. Which of the Four I's of service refers to the fact that employees such as Ahmed must be scheduled to work anytime a service business is open and regardless of low volume levels? Inventory (perishability. Unsold inventory vanishes if not sold and the costs associated with idle production capacity can be high.) Which of the Four I's of service refers to the tendency of consumers to equate the quality of service provided with the attitude of the person who actually provides the service? Inseparability Which of the Four I's of service addresses the fact that a hotel room that goes unsold on a specific night cannot be discounted and offered for sale the next day? Inventory Randall is the revenue manager for a franchisee who owns a five-unit quick-service restaurant company. Which feature would be the easiest for Randall to change if he sought to increase the value his company provides its customers? The quality of service offered What is the most common guest complaint about hotel guest rooms? Service deficiencies What is the most common guest complaint in the foodservice industry? Service quality Consider the formula: (A + B) - C = D Where: A = Perceived tangible product benefit B = Perceived intangible service benefit C = Price D = Value If all other variables are held constant, which statement is also true As C decreases, D increases Which two factors do successful revenue managers employ when they devise and implement strategic pricing plans? Data management and insight All except one of the following pricing systems are marketing-based. Which one is NOT an example of marketing-based pricing? Return on Investment (ROI) pricing What is true for franchised hotel operations in the United States? Their prices are established by the hotel owners What is the relationship between differential pricing and consumer surplus? Differential pricing is a strategy used by sellers to minimize consumer surplus Hottickets.com is a web-based business that buys popular concert tickets in bulk. It buys the tickets at a low price because it qualifies for group ticket discounts offered by concert promoters. Hotticket.com then marks up and immediately resells the tickets it has purchased to interested individuals who visit the Hotticket website. What is the name of the activity Hottickets.com is engaging in? Arbitrage The use of a formal customer rewards program is an example of what type of differential pricing strategy? Pricing based on customer characteristic The premium prices charged for dinner served at the restaurant Le Jules Vernes on the second level of the Eifel Tower in Paris, France can be attributed, in part, to which type of differential pricing strategy? Pricing based on location Which statement about high volume buyers in the hospitality industry is true? The per-unit cost of selling to them is less than the cost associated with low volume buyers What is the formula revenue managers use to calculate Net ADR Yield? Net Room Rate / Standard ADR = Net ADR Yield Which statement about revenue management and revenue optimization is true? Revenue management seeks to maximize income while revenue optimization seeks to maximize long-term profits Hotel revenue managers face hard supply constraints. In which industry below are hard constraints also likely to be encountered? Hair salons What two factors establish a restaurant's weekly customer capacity? Number of seats and number of hours open per week What is the primary reason for forecasting future room demand? To make pricing-related decisions Scott is a revenue manager in a 600 room hotel. For tomorrow he forecasts that 10 rooms will be OOO and that there will be 80 stayovers with 300 arrivals. He also forecasts 30 no-shows, 10 early departures and 20 over-stays. What is Scott's forecast for the number of rooms occupied tomorrow? 360 When might a revenue manager at a lodging facility be pressured to establish a long-term forecast that is unrealistically low? When a significant financial incentive exists for exceeding the forecast In the lodging industry what factors would be overinflated to produce an unrealistically high RevPAR forecast? ADR and/or Occupancy % What is the most likely result of a revenue manager's decision to raise room rates during periods of very high demand? RevPAR will be increased What is one consistent characteristic of desirable rooms revenue? It leads to higher GOPPAR levels What is the industry term used to describe all of a hotel's unique or distinct forms of guestroom products available for sale? Rooms inventory Which of the following is not typically used by revenue managers to designate specific room products sold in their hotels? Price What is the lodging industry term used to describe two independent data management systems that have been electronically connected? Interface Tanika is the revenue manager at the Holiday House hotel. Southeast Airlines has requested that Tanika quote them a rate for the use of 20 rooms per night for a period of one year. If Southeast airlines accept Tanika's quote for both price and availability, what type of room rate will the hotel and airline have agreed upon? Contract rate Expedia.com wants Jessie, the revenue manager at the Hilton, to agree to contract terms that would require Jessie's hotel to apply the agreed upon Expedia rate to any room type (except suites) available at the time one of Expedia's customers wants to make a reservation. What is the industry term for Expedia.com's contract request? Last room availability Angelina is the revenue manager at the 1000 room Bay hotel. Tonight she forecasts 600 stay-overs and 400 arrivals. Assume Angelina is accurate in forecasting a 5% no-show rate. How many additional reservations could Angelina accept before she would be required to walk an arriving guest? 21 In the airline industry, airline companies establish ticket prices. In the lodging industry, who is responsible for establishing room selling prices? Hotel owners or their designees What is true about discounts offered on the selling price of hotel rooms? They should be easily explainable and defensible In which situation would a customer-centric revenue manager likely implement a special event rate? During a local festival that would fill all of the area hotels Hanna is the revenue manager at the Waterford hotel. For the first week in July next year, she has determined her hotel will accept reservations for guests seeking to arrive on July 1st. July 2nd. or July 3rd; but not on July 4th. Which of the following revenue management control (restriction) strategies is she using? CTA Which of the following is not a strategy typically used by revenue managers to optimize revenue during periods of high demand? Implement rack rate discounts to maximize occupancy To optimize revenues while enhancing property operations, which strategy pair should revenue managers seek to implement? Maximization of room codes, minimization of rate codes What strategy should be put into action when revenue managers implement special event rates? Enhance guest value by providing product and/or service enhancements Which travel industry-related business group developed the Global Distribution System? The airline industry What is true about the calculations required to calculate the following Net ADR Yield formula? Net Room Rate Standard ADR = Net ADR Yield Standard ADR (-) Distribution Channel Costs (=) Net Room Rate Lani is the revenue manager at the Aloha Inn. In which situation would Lani optimize the Inn's gross rooms revenues? High Standard ADR, high Net ADR Yield What is true about a future room reservation booked for a guest whose original reservation was booked through expedia.com and who is presently checking out of the hotel? No IDS fees will be paid on the revenue the new reservation will generate Last month Carl's hotel had a RevPAR index of 100. His occupancy index was 132.5 and his ADR index was 75.5. What is true about his hotel's performance last month? His GOPPAR is not optimized because it is low relative to the RevPARindex Last month Carl's hotel had an ADR index of 80.0% and an occupancy index of 120%. What was Carl's RevPAR index for last month? 96.0% Last month Carl's hotel had a RevPAR index of 133.0%. Based on that information alone; what does Carl know for sure about his hotel's performance last month? His ADR or occupancy index will exceed 100% Last month Carl's hotel supplied 10.8% of the rooms in his comp set. It attracted 11.6% of all the rooms sold (demand) and generated 9.1% of the total revenue achieved by the comp set. What is true about Carl's hotel? Its rates are low relative to the comp. set's and the hotel has an occupancy index above 100% What metrics are best used to assess the relative merits of a specific lodging industry distribution channel's contribution to a single hotel? Rooms sold and Net ADR Yield Shaniqua's restaurant utilizes a product cost percentage pricing system. She would like to apply pricing factors to make pricing her menus easier. What would be the pricing factor she would use when her desired product cost percentage for an item is 40%? 2.5 Which menu pricing system would utilize an operation's prime costs when calculating its selling prices? Product Cost: Plus What is the common feature in the Product Cost: Plus Pricing, the Contribution Margin Pricing and the Product Cost Percentage Pricing systems? The amount paid for products For revenue managers seeking to optimize revenues in their foodservice operations, which statement about menu prices is true? An appropriate menu price should dictate an item's cost Shaniqua's restaurant utilizes a product cost percentage pricing system. She would like to sell an item for $19.95. Her targeted product cost is 40%. With a 40% product cost, what is the amount her kitchen staff can spend on product cost when making this item? $ 7.98 Why can foodservice operators sell a 20 year Scotch at a price higher than a one-year-old Scotch? The quality of a 20-year-old Scotch is higher than a one-year-old Scotch The cost to the operator of a 20-year-old Scotch is higher than a one year old Scotch Customers prefer to pay high prices One-year-old Scotch is not popular The quality of a 20 year old Scotch is higher than a one year old Scotch Arthur's restaurant is extremely busy on Friday and Saturday. The manager of the operation offers reduced prices on quick-to-prepare and quick-to-serve menu items on those two nights. What revenue related factor is this restaurant manager seeking to positively influence? Capacity Poco Miller's restaurant has 130 seats. Last night Poco served 295 guests. What was is the formula Poco would use to calculate her table turns? 295/130 = Table turns Why should revenue managers monitor their competitors' prices? To keep their own prices on the higher end of their competitors' price ranges. Which value-related factor does a revenue manager seek to impact if prices for carry-out menu items in a restaurant are 10% less than the price of the same items when they are consumed in that restaurant's dining room? Service level Offering the same menu item in a variety of portion sizes is an example of what type of differential pricing strategy? Product versioning Last night Lara's restaurant served 225 guests and achieved total revenue of $4,500. What was Lara's check average last night? $ 20.00 What foodservice value-related factor is most affected when a revenue manager successfully implements a price blending strategy? Menu mix At Lauren's restaurant, the check average is always higher on Saturday night than on any other night. What is the most likely cause of the check average variance she experiences? The sales mix What business segment best describes a company that is engaged primarily in the sale of intangible goods? Service Revenue optimization strategies can make the most impact on inventory management in industries with which kind of cost structures? Low variable costs and high fixed costs Nearly every ski resort in the Upper Northeastern part of the US generates the majority of its annual income during the winter months. What is the cause of this? Constrained supply Which of the following would not be considered highly perishable inventory? French champagne