CHRM - CERTIFIED HOSPITALITY REVENUE
MANAGER EXAM | 2026 UPDATED | QUESTIONS
& VERIFIED ANSWERS WITH DETAILED
RATIONALS
Q1. What does RevPAR stand for?
A. Revenue Per Available Room B. Rate Value Per Available Room C. Revenue Per Actual
Room D. Rate Per Available Resource
CORRECT ANSWER: A. Revenue Per Available Room RATIONALE: RevPAR is
the most widely used KPI in hotel revenue management. It is calculated by multiplying ADR by
Occupancy Rate, or by dividing total room revenue by total available rooms. It measures how
well a hotel fills its available rooms at an average rate.
Q2. How is ADR calculated?
A. Total Revenue ÷ Total Available Rooms B. Total Room Revenue ÷ Total Rooms Sold C. Total
Revenue ÷ Total Occupied Rooms D. Total Rooms Sold ÷ Total Available Rooms
CORRECT ANSWER: B. Total Room Revenue ÷ Total Rooms
Sold RATIONALE: ADR (Average Daily Rate) measures the average rental income per
paid occupied room. It excludes complimentary rooms and only divides revenue by rooms that
were actually sold/paid for.
Q3. Which of the following best defines yield management?
A. Maximizing revenue through discounting rooms during low demand B. Selling the right room
to the right customer at the right time for the right price C. Offering the lowest possible rate to
increase occupancy D. Setting a fixed price for all room types regardless of demand
CORRECT ANSWER: B. Selling the right room to the right customer at the right time
for the right price RATIONALE: Yield management is the core principle of hospitality
revenue management. It involves variable pricing strategies based on anticipating and
influencing consumer behavior to maximize revenue from a fixed, perishable resource.
Q4. What is the formula for Occupancy Rate?
,A. Rooms Sold ÷ Total Revenue × 100 B. Total Revenue ÷ Rooms Available × 100 C. Rooms
Sold ÷ Rooms Available × 100 D. Rooms Available ÷ Rooms Sold × 100
CORRECT ANSWER: C. Rooms Sold ÷ Rooms Available ×
100 RATIONALE: Occupancy Rate expresses the percentage of available rooms that
were actually sold during a given period. It is a fundamental metric in evaluating hotel
performance alongside ADR and RevPAR.
Q5. What does TRevPAR measure?
A. Total revenue from food and beverage per available room B. Total revenue from all hotel
departments per available room C. Total room revenue per available room D. Total revenue per
actual room sold
CORRECT ANSWER: B. Total revenue from all hotel departments per available
room RATIONALE: TRevPAR (Total Revenue Per Available Room) goes beyond rooms
to include all revenue streams — F&B, spa, parking, etc. — divided by the number of available
rooms. It provides a more complete picture of overall hotel performance.
Q6. What is a hotel's "rack rate"?
A. The discounted rate offered to travel agents B. The lowest publicly available rate C. The
published, undiscounted standard room rate D. The rate negotiated with corporate clients
CORRECT ANSWER: C. The published, undiscounted standard room
rate RATIONALE: The rack rate is the maximum price a hotel charges for a room before
any discounts are applied. It serves as the baseline from which all other rates — corporate, AAA,
OTA, etc. — are discounted.
Q7. Which metric compares a hotel's RevPAR to that of its competitive set?
A. ADR Index B. RevPAR Index (RGI) C. Occupancy Index (MPI) D. ARI (Average Rate Index)
CORRECT ANSWER: B. RevPAR Index (RGI) RATIONALE: RGI (Revenue
Generation Index) or RevPAR Index measures a hotel's RevPAR relative to its competitive set.
An RGI above 100 means the hotel is outperforming its comp set, while below 100 means
underperformance.
,Q8. What does MPI stand for in the context of STR reports?
A. Market Penetration Index B. Monthly Pricing Index C. Market Performance Indicator D.
Maximum Pricing Index
CORRECT ANSWER: A. Market Penetration Index RATIONALE: MPI (Market
Penetration Index) measures a hotel's occupancy performance relative to its competitive set. A
score above 100 indicates the hotel is capturing more than its fair share of occupancy in the
market.
Q9. What does ARI stand for in STR reporting?
A. Annual Revenue Index B. Average Rate Index C. Adjusted Revenue Indicator D. Annual Rate
Increment
CORRECT ANSWER: B. Average Rate Index RATIONALE: ARI (Average Rate
Index) compares a hotel's ADR to the ADR of its competitive set. Along with MPI and RGI, it
forms part of the STR's three key performance indices used to benchmark competitive
performance.
Q10. Which of the following is a perishable product in hospitality?
A. A hotel's food inventory B. An unsold hotel room for a given night C. A spa treatment voucher
D. A hotel gift card
CORRECT ANSWER: B. An unsold hotel room for a given
night RATIONALE: Hotel rooms are perishable — once a night passes without a room
being sold, that revenue opportunity is permanently lost. This perishability is the primary reason
revenue management strategies are critical in the hotel industry.
Q11. What is a displacement analysis used for?
A. Evaluating employee performance B. Assessing whether accepting a group booking displaces
more profitable transient business C. Measuring the impact of marketing campaigns D.
Calculating the cost of distribution channels
CORRECT ANSWER: B. Assessing whether accepting a group booking displaces more
profitable transient business RATIONALE: Displacement analysis helps revenue
managers decide whether to accept a group booking by comparing the group's revenue
, contribution against the transient revenue that would be lost (displaced) if the group rooms were
committed.
Q12. Which of the following best describes "unconstrained demand"?
A. The actual number of rooms sold B. The demand that exists without any capacity restrictions
C. Demand that is limited by available room inventory D. The demand from walk-in guests only
CORRECT ANSWER: B. The demand that exists without any capacity
restrictions RATIONALE: Unconstrained demand reflects how many rooms guests
would want to book if capacity were unlimited. This is an important forecasting concept —
revenue managers must understand true demand before applying inventory controls.
Q13. What is a "booking window" or "booking lead time"?
A. The minimum stay requirement at a hotel B. The period of time between when a reservation is
made and when the guest arrives C. The window of time when rates are lowest D. The check-in
and check-out period
CORRECT ANSWER: B. The period of time between when a reservation is made and
when the guest arrives RATIONALE: Booking window (or lead time) is the advance
time between reservation and arrival. Revenue managers analyze booking windows to
understand when demand materializes and to apply the appropriate pricing strategies by segment.
Q14. What is the purpose of a "length of stay" (LOS) restriction?
A. To limit the number of guests per room B. To encourage guests to stay longer by managing
inventory around high-demand periods C. To prevent guests from checking out early D. To set a
maximum number of nights allowed per booking
CORRECT ANSWER: B. To encourage guests to stay longer by managing inventory
around high-demand periods RATIONALE: LOS restrictions (such as minimum length
of stay) help hotels maximize revenue during peak demand periods by preventing short stays that
would block higher-value, longer-staying guests from booking.
Q15. What does "MLOS" stand for?
A. Maximum Length of Stay B. Minimum Length of Stay C. Monthly Level of Sales D.
Managed Length of Service
MANAGER EXAM | 2026 UPDATED | QUESTIONS
& VERIFIED ANSWERS WITH DETAILED
RATIONALS
Q1. What does RevPAR stand for?
A. Revenue Per Available Room B. Rate Value Per Available Room C. Revenue Per Actual
Room D. Rate Per Available Resource
CORRECT ANSWER: A. Revenue Per Available Room RATIONALE: RevPAR is
the most widely used KPI in hotel revenue management. It is calculated by multiplying ADR by
Occupancy Rate, or by dividing total room revenue by total available rooms. It measures how
well a hotel fills its available rooms at an average rate.
Q2. How is ADR calculated?
A. Total Revenue ÷ Total Available Rooms B. Total Room Revenue ÷ Total Rooms Sold C. Total
Revenue ÷ Total Occupied Rooms D. Total Rooms Sold ÷ Total Available Rooms
CORRECT ANSWER: B. Total Room Revenue ÷ Total Rooms
Sold RATIONALE: ADR (Average Daily Rate) measures the average rental income per
paid occupied room. It excludes complimentary rooms and only divides revenue by rooms that
were actually sold/paid for.
Q3. Which of the following best defines yield management?
A. Maximizing revenue through discounting rooms during low demand B. Selling the right room
to the right customer at the right time for the right price C. Offering the lowest possible rate to
increase occupancy D. Setting a fixed price for all room types regardless of demand
CORRECT ANSWER: B. Selling the right room to the right customer at the right time
for the right price RATIONALE: Yield management is the core principle of hospitality
revenue management. It involves variable pricing strategies based on anticipating and
influencing consumer behavior to maximize revenue from a fixed, perishable resource.
Q4. What is the formula for Occupancy Rate?
,A. Rooms Sold ÷ Total Revenue × 100 B. Total Revenue ÷ Rooms Available × 100 C. Rooms
Sold ÷ Rooms Available × 100 D. Rooms Available ÷ Rooms Sold × 100
CORRECT ANSWER: C. Rooms Sold ÷ Rooms Available ×
100 RATIONALE: Occupancy Rate expresses the percentage of available rooms that
were actually sold during a given period. It is a fundamental metric in evaluating hotel
performance alongside ADR and RevPAR.
Q5. What does TRevPAR measure?
A. Total revenue from food and beverage per available room B. Total revenue from all hotel
departments per available room C. Total room revenue per available room D. Total revenue per
actual room sold
CORRECT ANSWER: B. Total revenue from all hotel departments per available
room RATIONALE: TRevPAR (Total Revenue Per Available Room) goes beyond rooms
to include all revenue streams — F&B, spa, parking, etc. — divided by the number of available
rooms. It provides a more complete picture of overall hotel performance.
Q6. What is a hotel's "rack rate"?
A. The discounted rate offered to travel agents B. The lowest publicly available rate C. The
published, undiscounted standard room rate D. The rate negotiated with corporate clients
CORRECT ANSWER: C. The published, undiscounted standard room
rate RATIONALE: The rack rate is the maximum price a hotel charges for a room before
any discounts are applied. It serves as the baseline from which all other rates — corporate, AAA,
OTA, etc. — are discounted.
Q7. Which metric compares a hotel's RevPAR to that of its competitive set?
A. ADR Index B. RevPAR Index (RGI) C. Occupancy Index (MPI) D. ARI (Average Rate Index)
CORRECT ANSWER: B. RevPAR Index (RGI) RATIONALE: RGI (Revenue
Generation Index) or RevPAR Index measures a hotel's RevPAR relative to its competitive set.
An RGI above 100 means the hotel is outperforming its comp set, while below 100 means
underperformance.
,Q8. What does MPI stand for in the context of STR reports?
A. Market Penetration Index B. Monthly Pricing Index C. Market Performance Indicator D.
Maximum Pricing Index
CORRECT ANSWER: A. Market Penetration Index RATIONALE: MPI (Market
Penetration Index) measures a hotel's occupancy performance relative to its competitive set. A
score above 100 indicates the hotel is capturing more than its fair share of occupancy in the
market.
Q9. What does ARI stand for in STR reporting?
A. Annual Revenue Index B. Average Rate Index C. Adjusted Revenue Indicator D. Annual Rate
Increment
CORRECT ANSWER: B. Average Rate Index RATIONALE: ARI (Average Rate
Index) compares a hotel's ADR to the ADR of its competitive set. Along with MPI and RGI, it
forms part of the STR's three key performance indices used to benchmark competitive
performance.
Q10. Which of the following is a perishable product in hospitality?
A. A hotel's food inventory B. An unsold hotel room for a given night C. A spa treatment voucher
D. A hotel gift card
CORRECT ANSWER: B. An unsold hotel room for a given
night RATIONALE: Hotel rooms are perishable — once a night passes without a room
being sold, that revenue opportunity is permanently lost. This perishability is the primary reason
revenue management strategies are critical in the hotel industry.
Q11. What is a displacement analysis used for?
A. Evaluating employee performance B. Assessing whether accepting a group booking displaces
more profitable transient business C. Measuring the impact of marketing campaigns D.
Calculating the cost of distribution channels
CORRECT ANSWER: B. Assessing whether accepting a group booking displaces more
profitable transient business RATIONALE: Displacement analysis helps revenue
managers decide whether to accept a group booking by comparing the group's revenue
, contribution against the transient revenue that would be lost (displaced) if the group rooms were
committed.
Q12. Which of the following best describes "unconstrained demand"?
A. The actual number of rooms sold B. The demand that exists without any capacity restrictions
C. Demand that is limited by available room inventory D. The demand from walk-in guests only
CORRECT ANSWER: B. The demand that exists without any capacity
restrictions RATIONALE: Unconstrained demand reflects how many rooms guests
would want to book if capacity were unlimited. This is an important forecasting concept —
revenue managers must understand true demand before applying inventory controls.
Q13. What is a "booking window" or "booking lead time"?
A. The minimum stay requirement at a hotel B. The period of time between when a reservation is
made and when the guest arrives C. The window of time when rates are lowest D. The check-in
and check-out period
CORRECT ANSWER: B. The period of time between when a reservation is made and
when the guest arrives RATIONALE: Booking window (or lead time) is the advance
time between reservation and arrival. Revenue managers analyze booking windows to
understand when demand materializes and to apply the appropriate pricing strategies by segment.
Q14. What is the purpose of a "length of stay" (LOS) restriction?
A. To limit the number of guests per room B. To encourage guests to stay longer by managing
inventory around high-demand periods C. To prevent guests from checking out early D. To set a
maximum number of nights allowed per booking
CORRECT ANSWER: B. To encourage guests to stay longer by managing inventory
around high-demand periods RATIONALE: LOS restrictions (such as minimum length
of stay) help hotels maximize revenue during peak demand periods by preventing short stays that
would block higher-value, longer-staying guests from booking.
Q15. What does "MLOS" stand for?
A. Maximum Length of Stay B. Minimum Length of Stay C. Monthly Level of Sales D.
Managed Length of Service
