HSA 546 Exam 1 (Answered)
The reason the hotel business is cyclical in nature is: - CORRECT ANSWER because
of the difference between the lifetime of a hotel and the cycle of hotel building, meaning
that frantic building is followed by periods of excess capacity
The three factors or dimensions in making a decision to invest in a hotel are: -
CORRECT ANSWER availability of financing, real estate values, and hotel operations.
Name the two kinds of management companies - CORRECT ANSWER 1) Chain
management companies
2) Independent management companies
From the real estate development's point of view, why is a hotel built: (3) - CORRECT
ANSWER 1) The area or community needs the property.
2) The underlying value of the real estate and its appreciation are more important to the
investors than the profitability of the hotel.
3) In inflationary times, hotel pricing is flexible and can be raised overnight.
The demand for hotel rooms changes direction - CORRECT ANSWER 3 to 6 months
after the economy does
The major factor that sets off over-building in the hotel industry is - CORRECT
ANSWER an increase in demand for rooms
Which of the following terms refer to ownership? - CORRECT ANSWER Equity
A major change in hotel financing has been - CORRECT ANSWER the growth of funds
from public markets
A REIT - CORRECT ANSWER Raises money by issuing stock
The written agreement between a hotel management company and the hotel owner is
called a - CORRECT ANSWER Management contract
M&A activity will increase when - CORRECT ANSWER Capital is easily available and
less costly
The essence of lodging finance is that lodging - CORRECT ANSWER is capital
intensive and cyclical.
Investment in a hotel is attractive when - CORRECT ANSWER inflation is a real
possibility
The reason the hotel business is cyclical in nature is: - CORRECT ANSWER because
of the difference between the lifetime of a hotel and the cycle of hotel building, meaning
that frantic building is followed by periods of excess capacity
The three factors or dimensions in making a decision to invest in a hotel are: -
CORRECT ANSWER availability of financing, real estate values, and hotel operations.
Name the two kinds of management companies - CORRECT ANSWER 1) Chain
management companies
2) Independent management companies
From the real estate development's point of view, why is a hotel built: (3) - CORRECT
ANSWER 1) The area or community needs the property.
2) The underlying value of the real estate and its appreciation are more important to the
investors than the profitability of the hotel.
3) In inflationary times, hotel pricing is flexible and can be raised overnight.
The demand for hotel rooms changes direction - CORRECT ANSWER 3 to 6 months
after the economy does
The major factor that sets off over-building in the hotel industry is - CORRECT
ANSWER an increase in demand for rooms
Which of the following terms refer to ownership? - CORRECT ANSWER Equity
A major change in hotel financing has been - CORRECT ANSWER the growth of funds
from public markets
A REIT - CORRECT ANSWER Raises money by issuing stock
The written agreement between a hotel management company and the hotel owner is
called a - CORRECT ANSWER Management contract
M&A activity will increase when - CORRECT ANSWER Capital is easily available and
less costly
The essence of lodging finance is that lodging - CORRECT ANSWER is capital
intensive and cyclical.
Investment in a hotel is attractive when - CORRECT ANSWER inflation is a real
possibility
