Revenue Management Final Exam
1. What is the industry term used to describe the sum of prices paid by a
business's customers?: Total Revenues
2. Historically, what concept have hospitality managers chiefly used to
calculate their selling prices?: Costs
3. What is an algebraic equivalent of the formula: Sales = Costs + Profit?: Profi
= Sales - Costs
4. What is the name for the net value achieved by both parties in a business
transaction?: Profit
5. What element is not present in a barter economy?: Money
6. What is the formula used to calculate an owner's ROI?: Owner's Investment
Return / Owner's Original Investment = Owner's Return on Investment
7. 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
8. Which industry was the first to use Yield Management principles?: Airline 9
What is the industry term used to describe the selling of rooms which are
not actually available for sale?: Overbooking
10. What is the formula used to calculate Average Daily Rate?: Total Room's
Revenue / Total Rooms Sold = Average Daily Rate
11. Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hote
has 250 rooms. What was Tashia's occupancy % last night?: 70%
12. Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hote
has 250 rooms. What was Tashia's RevPAR last night?: $140.00
13. What is the industry term for the average revenue generated by each
occupied guestroom during a defined period of time?: RevPOR
14. What is the formula used to calculate GOPPAR?: (Total Revenue
Management Controllable Expenses) / Rooms Available to Sell = GOPPAR
15. What is the industry term for a customer group which can be readily
identified by one or more common characteristics?: Market Segment
16. What is rack rate?: The price of rooms when no discounts of any type are
offered 17. What is:
Total period revenue
(Number of available seats) x (hours of seat availability): The formula for
RevPASH
18. 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
, Revenue Management Final Exam
19 What is the term used to describe the potential customers to whom a
business's marketing activities and messages are directed?: The target marke
20. What is the term used to describe efforts undertaken to encourage trave
and tourism to a specific geographic area or attraction?: Destination Marketing
21. What is the name for the value given up by a buyer and a seller in a
business transaction?: Price
22. Charging guests for watching a "Pay-Per-View" movie in their hote
guestroom is an example of what type of pricing?: Two-tiered pricing
23. What is the fundamental assumption upon which the concept of
consumer rationality is based?: Buyers act in ways that are of personal benefit to
them 24. What is the revenue management term used to describe the
perceived benefit gained, minus the price paid, in a business transaction?
Value
25. What is created when a seller communicates to a buyer a description of
a product to be sold and the price at which that product will be sold?: A value
proposition
26. Which one of the following terms is not one of the 4 Ps of the Marketing
Mix?: Proposition
27. Which of the following terms would be included in the Place portion of a
hotel's marketing mix?: Distribution Channels
28. What is the fundamental assumption upon which the Law of Supply is
based?: The higher the demand for a product the more of it will be produced by
sellers
29. According to Alfred Marshall's work, if the price of a product is lower than
the natural, or equilibrium price, what will happen?: The demand fort he produc
would exceed its supply
30. Assume an equilibrium price (P1) is in place for a product. What would
the law of supply and demand predict as an outcome if demand for that
product increased?: The new price (P2) would be lower than the previous price
(P1) because supply would decrease
31. What concept is displayed by the intersecting point on a supply and
demand curve?: An estimate of the amount of a product that would be purchased
at a known price and point in time
32. What must be true if a product producer is to continue creating and
selling products?: Revenues must exceed costs
33. What is the specialized branch of accounting that focuses on recording
and analyzing the expenses incurred by an organization?: Cost Accounting 34
, Revenue Management Final Exam
What is the industry term for the point at which an organization's revenues
exactly equal its costs?: Break-even point
35. Which of the following foodservice costs is a variable cost?: Food
36 Which of the following lodging costs is a fixed cost?: Mortgage payments
37. In a hospitality industry break-even analysis graph the Total Revenues
line starts at 0. Why does the Total Costs line always start farther up the y
axis?: Because fixed costs are incurred even if no guests are served or rooms are
sold
38. Which of the following statements about unit costs in the hospitality
industry is true?: Unit costs will vary based upon how high or low an item is priced
39. Which of the following statements about the relationship between costs
and pricing is true?: An appropriate selling price for a product or service mus
dictate its allowable costs
40. If a Revenue Manager implements an organization's strategic pricing plan
what personal characteristic of that Revenue Manager will be most
important for ensuring the plan's success?: An understanding of an
organization's customers
41. Which formula represents a buyer's view of a sales transaction?: Perceived
Value - Selling Price = Personal Profit
42. What type of benefit is lacking in material qualities and is not able to be
touched or seen but nonetheless can still be perceived?: Intangible
43. What will be the typical case in an auction when the initial price bid for the
item being sold is very low?: The number of potential bidders will be high
44. Penny Larson is traveling to San Francisco for a personal vacation. Which
of economist Milton Friedman's buyer value formulas would apply to her
purchase of the hotel rooms she will need during her trip?: Spending he
own money on herself
45. Penny Larson is travelling to San Francisco on business. Her company
will reimburse 100% of her travel expense. Which of economist Milton
Friedman's buyer value formulas would apply to her purchase of the hote
rooms she will need during her trip?: Spending someone else's money on
herself
46. Penny Larson is buying a $100.00 restaurant gift card as a present for her
niece who is graduating from hospitality management school. Which of
economist Milton Friedman's buyer value formulas would apply to her
purchase?: Spending her own money on someone else
47. Penny Larson is a travel agent arranging a one-week San Francisco
vacation for Mr. and Mrs. Rafael Ochoa. Which of economist Milton
1. What is the industry term used to describe the sum of prices paid by a
business's customers?: Total Revenues
2. Historically, what concept have hospitality managers chiefly used to
calculate their selling prices?: Costs
3. What is an algebraic equivalent of the formula: Sales = Costs + Profit?: Profi
= Sales - Costs
4. What is the name for the net value achieved by both parties in a business
transaction?: Profit
5. What element is not present in a barter economy?: Money
6. What is the formula used to calculate an owner's ROI?: Owner's Investment
Return / Owner's Original Investment = Owner's Return on Investment
7. 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
8. Which industry was the first to use Yield Management principles?: Airline 9
What is the industry term used to describe the selling of rooms which are
not actually available for sale?: Overbooking
10. What is the formula used to calculate Average Daily Rate?: Total Room's
Revenue / Total Rooms Sold = Average Daily Rate
11. Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hote
has 250 rooms. What was Tashia's occupancy % last night?: 70%
12. Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hote
has 250 rooms. What was Tashia's RevPAR last night?: $140.00
13. What is the industry term for the average revenue generated by each
occupied guestroom during a defined period of time?: RevPOR
14. What is the formula used to calculate GOPPAR?: (Total Revenue
Management Controllable Expenses) / Rooms Available to Sell = GOPPAR
15. What is the industry term for a customer group which can be readily
identified by one or more common characteristics?: Market Segment
16. What is rack rate?: The price of rooms when no discounts of any type are
offered 17. What is:
Total period revenue
(Number of available seats) x (hours of seat availability): The formula for
RevPASH
18. 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
, Revenue Management Final Exam
19 What is the term used to describe the potential customers to whom a
business's marketing activities and messages are directed?: The target marke
20. What is the term used to describe efforts undertaken to encourage trave
and tourism to a specific geographic area or attraction?: Destination Marketing
21. What is the name for the value given up by a buyer and a seller in a
business transaction?: Price
22. Charging guests for watching a "Pay-Per-View" movie in their hote
guestroom is an example of what type of pricing?: Two-tiered pricing
23. What is the fundamental assumption upon which the concept of
consumer rationality is based?: Buyers act in ways that are of personal benefit to
them 24. What is the revenue management term used to describe the
perceived benefit gained, minus the price paid, in a business transaction?
Value
25. What is created when a seller communicates to a buyer a description of
a product to be sold and the price at which that product will be sold?: A value
proposition
26. Which one of the following terms is not one of the 4 Ps of the Marketing
Mix?: Proposition
27. Which of the following terms would be included in the Place portion of a
hotel's marketing mix?: Distribution Channels
28. What is the fundamental assumption upon which the Law of Supply is
based?: The higher the demand for a product the more of it will be produced by
sellers
29. According to Alfred Marshall's work, if the price of a product is lower than
the natural, or equilibrium price, what will happen?: The demand fort he produc
would exceed its supply
30. Assume an equilibrium price (P1) is in place for a product. What would
the law of supply and demand predict as an outcome if demand for that
product increased?: The new price (P2) would be lower than the previous price
(P1) because supply would decrease
31. What concept is displayed by the intersecting point on a supply and
demand curve?: An estimate of the amount of a product that would be purchased
at a known price and point in time
32. What must be true if a product producer is to continue creating and
selling products?: Revenues must exceed costs
33. What is the specialized branch of accounting that focuses on recording
and analyzing the expenses incurred by an organization?: Cost Accounting 34
, Revenue Management Final Exam
What is the industry term for the point at which an organization's revenues
exactly equal its costs?: Break-even point
35. Which of the following foodservice costs is a variable cost?: Food
36 Which of the following lodging costs is a fixed cost?: Mortgage payments
37. In a hospitality industry break-even analysis graph the Total Revenues
line starts at 0. Why does the Total Costs line always start farther up the y
axis?: Because fixed costs are incurred even if no guests are served or rooms are
sold
38. Which of the following statements about unit costs in the hospitality
industry is true?: Unit costs will vary based upon how high or low an item is priced
39. Which of the following statements about the relationship between costs
and pricing is true?: An appropriate selling price for a product or service mus
dictate its allowable costs
40. If a Revenue Manager implements an organization's strategic pricing plan
what personal characteristic of that Revenue Manager will be most
important for ensuring the plan's success?: An understanding of an
organization's customers
41. Which formula represents a buyer's view of a sales transaction?: Perceived
Value - Selling Price = Personal Profit
42. What type of benefit is lacking in material qualities and is not able to be
touched or seen but nonetheless can still be perceived?: Intangible
43. What will be the typical case in an auction when the initial price bid for the
item being sold is very low?: The number of potential bidders will be high
44. Penny Larson is traveling to San Francisco for a personal vacation. Which
of economist Milton Friedman's buyer value formulas would apply to her
purchase of the hotel rooms she will need during her trip?: Spending he
own money on herself
45. Penny Larson is travelling to San Francisco on business. Her company
will reimburse 100% of her travel expense. Which of economist Milton
Friedman's buyer value formulas would apply to her purchase of the hote
rooms she will need during her trip?: Spending someone else's money on
herself
46. Penny Larson is buying a $100.00 restaurant gift card as a present for her
niece who is graduating from hospitality management school. Which of
economist Milton Friedman's buyer value formulas would apply to her
purchase?: Spending her own money on someone else
47. Penny Larson is a travel agent arranging a one-week San Francisco
vacation for Mr. and Mrs. Rafael Ochoa. Which of economist Milton
