HMD 440 Exam 2 (Ch 5-9) Questions with Correct Answers Graded A+
Are the following statements true or false about BAR:
-Forecast accuracy is very important to make this pricing technique function properly.
-Competitor rates should be taken into consideration before making a final decision on the rates.
- Answers True
Open pricing refers to - Answers compute optimal rates for each date and room type
independently and adjusting the price dynamically thanks to real-time data.
Rate parity exists - Answers when the price of the same room is the same across all distribution
channels
__________________________ refers to the degree to which individuals, consumers, or producers
change their demand or the amount supplied in response to price changes. - Answers Price
elasticity
When little changes in price cause significant changes in the number of rooms sold, demand is
considered to be: - Answers elastic
Price elasticity of demand measures the change in the quantity demanded due to the change in
the price of a good or service. - Answers True
For example, if two prices are listed for the same room for the same night, hoteliers should
make sure that there should be a factor that justifies the price difference between each room.
This is an example of: - Answers Rate Integrity
Segmented pricing is also labelled as: - Answers All of them (Differential pricing, price
differentiation, price discrimination)
In line with this objective, hoteliers strive a balance between short-term revenue maximization
and long-term ______________________________ to stay competitive. - Answers Customer
relationship management (CRM)
Price discrimination is - Answers a pricing strategy where identical or largely similar goods or
services are sold at different prices by the same provider to different customers
Which pricing technique involves closing lower rate categories as demand increases? - Answers
Demand-based pricing
In the revenue management context, rate integrity is about fair pricing, rationalizing different
price levels and ensuring discounted rates are consistent across all distribution channels. -
Answers True
, Customer lifetime value (CLTV) is - Answers a prediction of the monetary value of the whole
future relationship with a customer.
Hotels employ strategies that seek to differentiate (segment) or vary (dynamically) room rates,
or a combination of both. - Answers True
Which of the following is true about total revenue management? - Answers It focuses on net
profits rather than revenue
Big data - Answers can be useful to pricing decisions
Which of the following is not true about BAR pricing? - Answers Hotels usually have around 20-
25 BAR levels
Following are different categories scholars use to define different types of hotel customers
according to user duration and lifetime profitability. - Answers All of them (barnacles, butterflies,
strangers, true friends)
Price elasticity of supply measures the responsiveness to the supply of a good or service after a
change in its market price. - Answers True
In order to make demand-based pricing effective, which of the following issues must be dealt
with? A hotel needs to: - Answers Examine historical rate levels along with demand at each level,
competitor rates and their customer segments before make a decision about the number of
BAR levels.
Which of the following hotels have more flexibility with overbooking? - Answers ?
Good inventory management starts with accurate forecasting. Forecasting and inventory
management both require analysis of - Answers All of them (the current reservations, insight
from hotel management , historical data)
What is another name for a performance clause? - Answers Group pick-up and attrition clause
What is the name of the clause that cancels or overrides contract requirements in the event of
an Act of God or Nature? - Answers Force Majeure
Inventory management in a hotel refers to managing the inventory of rooms sold in coordination
with room rates. But inventory management does not include determining a balance of transient,
group and contract rooms available for sale. - Answers False
Forecasting and inventory management both require an analysis of: - Answers All of them
(management insight, historical data, current reservations)
Which of the following reservation type is the most likely to cancel or no-show? - Answers Time
arrival reservation
Are the following statements true or false about BAR:
-Forecast accuracy is very important to make this pricing technique function properly.
-Competitor rates should be taken into consideration before making a final decision on the rates.
- Answers True
Open pricing refers to - Answers compute optimal rates for each date and room type
independently and adjusting the price dynamically thanks to real-time data.
Rate parity exists - Answers when the price of the same room is the same across all distribution
channels
__________________________ refers to the degree to which individuals, consumers, or producers
change their demand or the amount supplied in response to price changes. - Answers Price
elasticity
When little changes in price cause significant changes in the number of rooms sold, demand is
considered to be: - Answers elastic
Price elasticity of demand measures the change in the quantity demanded due to the change in
the price of a good or service. - Answers True
For example, if two prices are listed for the same room for the same night, hoteliers should
make sure that there should be a factor that justifies the price difference between each room.
This is an example of: - Answers Rate Integrity
Segmented pricing is also labelled as: - Answers All of them (Differential pricing, price
differentiation, price discrimination)
In line with this objective, hoteliers strive a balance between short-term revenue maximization
and long-term ______________________________ to stay competitive. - Answers Customer
relationship management (CRM)
Price discrimination is - Answers a pricing strategy where identical or largely similar goods or
services are sold at different prices by the same provider to different customers
Which pricing technique involves closing lower rate categories as demand increases? - Answers
Demand-based pricing
In the revenue management context, rate integrity is about fair pricing, rationalizing different
price levels and ensuring discounted rates are consistent across all distribution channels. -
Answers True
, Customer lifetime value (CLTV) is - Answers a prediction of the monetary value of the whole
future relationship with a customer.
Hotels employ strategies that seek to differentiate (segment) or vary (dynamically) room rates,
or a combination of both. - Answers True
Which of the following is true about total revenue management? - Answers It focuses on net
profits rather than revenue
Big data - Answers can be useful to pricing decisions
Which of the following is not true about BAR pricing? - Answers Hotels usually have around 20-
25 BAR levels
Following are different categories scholars use to define different types of hotel customers
according to user duration and lifetime profitability. - Answers All of them (barnacles, butterflies,
strangers, true friends)
Price elasticity of supply measures the responsiveness to the supply of a good or service after a
change in its market price. - Answers True
In order to make demand-based pricing effective, which of the following issues must be dealt
with? A hotel needs to: - Answers Examine historical rate levels along with demand at each level,
competitor rates and their customer segments before make a decision about the number of
BAR levels.
Which of the following hotels have more flexibility with overbooking? - Answers ?
Good inventory management starts with accurate forecasting. Forecasting and inventory
management both require analysis of - Answers All of them (the current reservations, insight
from hotel management , historical data)
What is another name for a performance clause? - Answers Group pick-up and attrition clause
What is the name of the clause that cancels or overrides contract requirements in the event of
an Act of God or Nature? - Answers Force Majeure
Inventory management in a hotel refers to managing the inventory of rooms sold in coordination
with room rates. But inventory management does not include determining a balance of transient,
group and contract rooms available for sale. - Answers False
Forecasting and inventory management both require an analysis of: - Answers All of them
(management insight, historical data, current reservations)
Which of the following reservation type is the most likely to cancel or no-show? - Answers Time
arrival reservation
