Intro to Revenue Management_DPP

The hotel has 100 rooms. Current occupied rooms and expected arrival rooms for today sums up to 105 rooms. This is an __________ situation.

• low occupancy

• overbooking

• walk out

• turn away

Airplane seats and hotel rooms are considered __________ inventory.

Lost opportunity to sell cannot be recovered.

• gone

• stockpile

• perishable

• previous

When consumers of different market segments are willing to pay different prices for the same product, price ___________ surfaces.

• increase

• drop

• equality

• discrimination

Revenue management practices demand forecasting. A business hotel is likely to expect more demand for hotel rooms during __________.

• weekdays

• weekends

• Christmas

• school holidays

Answer explanation

Answer: Weekdays because business hotels target corporate clients who fly in to work on weekdays.

Total Room Revenue = Number of rooms sold X _______ Daily Rate

• Maximum

• Minimum

• Average

• Expected

Answer explanation

Answer:

Average Daily Rate (ADR)

Hotel industry has low fixed costs and high variable costs.

• True

• False

Answer explanation

Answer:

Hotel industry has high fixed costs and low variable costs.

_______= Revenue – (Fixed costs + Variable costs)

Guest supplies (amenities) is a variable cost to hotels.

• True

• False

The revenue manager is considering where to sell the hotel rooms. She identifies 'Online Travel Agencies', 'Group travel agents', 'Phone conversions by central reservations' and 'walk-ins' as possible ____________ channels.

Fire insurance is a variable cost to hotels.

• True

• False

Answer explanation

Answer:

False, because fire insurance is a fixed cost to the hotel. The cost is incurred regardless of how many guests are occupying the hotel rooms.