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REVENUE MANAGEMENT FINAL EXAM
QUESTIONS AND CORRECT ANSWERS
"Which industry was the first to use Yield Management principles? - CORRECT ANSWER
Airline" "What is the industry term used to describe the selling of rooms which are not actually available
for sale? - CORRECT ANSWER Overbooking"
"What is the formula used to calculate Average Daily Rate? - CORRECT ANSWER Total
Room's Revenue / Total Rooms Sold = Average Daily Rate" "Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hotel has 250 rooms. What was
Tashia's occupancy % last night? - CORRECT ANSWER 70%"
"Tashia's hotel sold 175 rooms last night at an ADR of $200.00. Her hotel has 250 rooms. What was
Tashia's RevPAR last night? - CORRECT ANSWER $140.00"
"Charging guests for watching a "Pay-Per-View" movie in their hotel guestroom is an example of
what type of pricing? - CORRECT ANSWER Two-tiered pricing"
"What is the fundamental assumption upon which the concept of consumer rationality is based?
CORRECT ANSWER Buyers act in ways that are of personal benefit to them"
"What is the revenue management term used to describe the perceived benefit gained, minus the
price paid, in a business transaction? - CORRECT ANSWER Value"
"Which of the following foodservice costs is a variable cost? - CORRECT ANSWER Food"
"Which of the following lodging costs is a fixed cost? - CORRECT ANSWER Mortgage
payments" "Which of the Four I's of service refers to the tendency of consumers to equate the quality of
service provided with the attitude of the person who actually provides the service? - CORRECT
ANSWER Inseperability"
"Which of the Four I's of service addresses the fact that a hotel room that goes unsold on a specific
night cannot be discounted and offered for sale the next day? - CORRECT ANSWER
Inventory" "Randall is the revenue manager for a franchisee who owns a five unit quick service restaurant company. Which feature would be the easiest for Randall to change if he sought to increase the
value his company provides its customers? - CORRECT ANSWER The quality of service
offered"
"What is the most common guest complaint about hotel guest rooms? - CORRECT ANSWER
Service deficiencies"
"What is the most common guest complaint in the food service industry? - CORRECT
ANSWER Service Quality"
"Consider the formula: (A + B) - C = D Where: A = Perceived tangible product benefit B = Perceived intangible service benefit C = Price D = Value
If all other variables are held constant, which statement is also true? - CORRECT ANSWER As
C decreases, D increases" "Which two factors do successful revenue managers employ when they devise and implement
strategic pricing plans? - CORRECT ANSWER Data management and insight"
"Which statement about revenue management in the hospitality industry is true? - CORRECT
ANSWER Quiz four Question one (??)"
"What is value-based pricing? - CORRECT ANSWER A pricing system based upon a buyer's
view of product or service value" "All except one of the following pricing systems are marketing-based. Which one is not an
example of marketing-based pricing? - CORRECT ANSWER Return on Investment (ROI)
pricing" "What is the term used to describe a pricing system in which all customers are charged the same
price at all times? - CORRECT ANSWER Fixed pricing"
"What is true for franchised hotel operations in the United States? - CORRECT ANSWER
Their prices are established by their franchisors"
"What is the primary reason for forecasting future room demand? - CORRECT ANSWER To
make pricing-related decisions" "Scott is a revenue manger in a 600 room hotel. For tomorrow he forecasts that 10 rooms will be OOO and that there will be 80 stayovers with 300 arrivals. He also forecasts 30 no-shows, 10 early departures and 20 over-stays. What is Scott's forecast for the number of rooms occupied
tomorrow? - CORRECT ANSWER 360"
"In the lodging industry, when is a guest considered to be an over-stay? - CORRECT ANSWER
When the guest checks out of the hotel after his or her originally scheduled check-out date" "When might a revenue manager at a lodging facility be pressured to establish a long-term
forecast that is unrealistically low? - CORRECT ANSWER When a significant financial
incentive exists for exceeding the forecast" "In the lodging industry what factors would be overinflated to produce an unrealistically high
RevPAR forecast? - CORRECT ANSWER ADR and/or Occupancy %"
"What is the most customer-centric strategy for revenue managers to employ if they seek to
optimize ADR and RevPAR in periods of temporarily heightened demand? - CORRECT
ANSWER Eliminate Discounts"
"Lani is the revenue manager at the Aloha Inn. In which situation would Lani optimize the Inn's
gross rooms revenues? - CORRECT ANSWER High Standard ADR, high Net ADR Yield"
"What is the industry term for a lower room rate that is offered when a potential rooms buyer
exhibits initial price resistance? - CORRECT ANSWER Fade rate"
"What is true about a future room reservation booked for a guest whose original reservation was
booked through expedia.com and who is presently checking out of the hotel? - CORRECT
ANSWER No IDS fees will be paid on the revenue the new reservation will generate"
"Harold tracks his hotel guest check outs and the number of new reservations made at check out. Last week a total of 640 guests checked out of his hotel. In that same period, his front desk staff booked reservations for 32 future rooms nights from this group of check out guests. What is true
at Harold's hotel? - CORRECT ANSWER The reservation nights booked per check out for last
week was .05"
"For which distribution channel type do hotels typically employ a shopper's service? -
CORRECT ANSWER Sales made via the telephone"
"Which is most often true about room sales made by a hotel's group sales department? -
CORRECT ANSWER ADRs are lower than average and Net ADR Yield is higher than average"
"How are most CVBs in the United States funded? - CORRECT ANSWER By a combination of
hotel occupancy taxes and membership dues"
"Which statement does not accurately describe a non-electric distribution channel? - CORRECT
ANSWER CRS is a non-electric distribution channel"
"Which of the following rooms marketing strategies would contribute to the commoditization of
hotel rooms? - CORRECT ANSWER Participation on a web site that lists only a hotel's name
and a single rack room rate" "Into which hotel industry distribution channel component would a brand's call center worker
enter room reservations he or she has made? - CORRECT ANSWER CRS"
"Which components of the hotel industry's current reservation system currently offers its users
the ability to simultaneously see comparative hotel rate information? - CORRECT ANSWER
The GDS and IDS" "Where on a hotel's statement of income and expense (income statement) does the 10th Edition of the Uniform System of Accounts for Lodging Industry (USALI) recommend travel agency
commissions be recorded? - CORRECT ANSWER The rooms expense portion"
"Which common IDS room sales model is most dependent on selling price for its revenue
generation? - CORRECT ANSWER Opaque Model"
"What is true about proprietary web sites administered by a hotel's franchisor? - CORRECT
ANSWER Content changes must be implemented by the brand's managers"
"Lara's rack rate is $299.99. She has been asked to bid on 200 rooms nights needed by a travel agent seeking housing for a group of seniors touring the area by bus. The travel agency has requested Lara provide her a net (non-commissionable) rate. Lara's hotel typically pays a 10% travel agency fee. What would be Lara's per room night net non-commissionable bid for these
rooms if she does not lower her rack rate? - CORRECT ANSWER $269.99"
"Which value-related factor does a revenue manager seek to impact if prices for carry-out menu items in a restaurant are 10% less than the price of the same items when they are consumed in
that restaurant's dining room? - CORRECT ANSWER Service Level"
"Offering the same menu item in a variety of portion sizes is an example of what type of
differential pricing strategy? - CORRECT ANSWER Product versioning"
"Last night Lara's restaurant served 225 guests and achieved total revenue of $4,500. What was
Lara's check average last night? - CORRECT ANSWER $20.00"
"What foodservice value-related factor is most affected when a revenue manager successfully
implements a price blending strategy? - CORRECT ANSWER Menu Mix"
"At Lauren's restaurant the check average is always higher on Saturday night than on any other
night. What is the most likely cause of the check average variance she experiences? - CORRECT
ANSWER The sales mix"
This formula represents a buyers view of a sales transaction? - CORRECT ANSWER Perceived
Value-Selling Price=Personal Profit" "Effective revenue managers use this to best develop and evaluate their organizations pricing and
revenue management strategies and tactics. - CORRECT ANSWER Regular Strategy
meetings"
"A pricing system based upon a buyers view of product or service value - CORRECT ANSWER
Value-based pricing"
"Included in the Place portion of a hotel's markieting mix - CORRECT ANSWER Distribution
channels" "Tasha's hotel sold 175 rooms last night at an ADR of 200.00. Her hotel has 250 rooms. What was
the RevPAR? - CORRECT ANSWER 140.00"
"The term used to describe efforts undertaken to encourage travel and tourism to a specific
geographic area or attraction - CORRECT ANSWER Destination marketing."
"An appropriate selling price for a product or service must dictate its allowable costs. -
CORRECT ANSWER TRUE"
"(A + B) - C = D - CORRECT ANSWER As C decreases, D increases"
"The name for the net value achieved by both parties in a business transaction - CORRECT
ANSWER Profit"
"STR - CORRECT ANSWER A company that specializes in helping hospitality managers
evaluate their effectiveness." "The requirement that a buyer present a coupon at the time of purhcase is an example of what
differential pricing - CORRECT ANSWER pricing based on customer chracteristics."
"What special challeges do buyers of hospitality products such as hotel guestrooms or restuarant
meals face - CORRECT ANSWER Difficulty in quality evaluation prior to purchase"
"What is the fundemental assumption upon which the Law of Supply is based? - CORRECT
ANSWER The higher the demand for a product the more of it will be produced by sellers"
"100 hotel rooms to sell. Saturday night has enough customers to sell 125 rooms so she will be
refusing 25 requests for rooms` - CORRECT ANSWER Constrained supply"
"GOPpar - CORRECT ANSWER =Total(rooms + non Rooms)revenue/Total occupied rooms"
"Donna is a hotel revenue manager preparing next year's rooms forecast. donna knows that in Nov. of next year a new hotel is opening near her own. As a result, she is considering reducing her rooms forecast for that month. If she does so, what data type will she primarily be using to make
her decision? - CORRECT ANSWER Future Data"
"For revenue managers working in the lodging industry the term "Place" in the 4ps of marketing
mix refers to items. One is the physical location of the hotel. What is the second? - CORRECT
ANSWER The property's distribution channel"
"A Front Desk Agent is NOT a hotel intermediary. - CORRECT ANSWER TRUE"
"One consistant characteristic of desirable room revenue is - CORRECT ANSWER It leads to
Higher GOPPAR levels" "What strategy should be put into action when revenue managers implement special events
rates/ - CORRECT ANSWER Enhance guest value by providing product and/or service
enhancements."
"What is the formula revenue managers use to calculate the percentage change in sales which has
occurred from the last accounting period to the present period? - CORRECT ANSWER Ttl
Sales this period - Ttl Sales Last Period / Ttl Sales Last Period = % of Change in Sales" "Amanda is the revenue manager of a hotel. When she opened her email last friday she found a message from the Exec. Director of the state dental assoc. asking Amanda for a formal price quote on rooms and meeting space needed by the assoc. for their annual onference. What would
Amanda call this inquiry? - CORRECT ANSWER RFP"
"Laras rack rate is 299.99. She has been asked to bid on 200 rooms nights needed by a travel agent seeking housing for a group of seniors touring the area by bus. The travel agency has requested Lara provide her a net (non-commissionable)rate. Laras hotel typically pays 10% travel agency fee. What would be Laras per room night net non-commercial bid for these rooms if she does not
lower her rack rate? - CORRECT ANSWER 269.99 (formula=(299.99 * .10=(30.00)) - 299.99 =
"Which components of the hotel industry's current reservaation system currently offers its users
the ability to simultaneously see comparative hotel rate information? - CORRECT ANSWER
The GDS and IDS" "Las month Carl's hotel had an ADR index of 125%. In the same month his RevPAR index was
100%. What can be said about Carl's hotel" - CORRECT ANSWER His occupancy index is less
than 100%" "This YTD, Carl's hotel is averaging an ADR of 125.00. The ADR of his comp. set for the same period is 125.00. Assume Carl's comp set is an appropriate one. What would you recommend Carl do if his
occupancy index for the same period is 140%. - CORRECT ANSWER Carefully increase rack
rates to optimize GOPPAR"
"In the lodging industry, what is rack rate? - CORRECT ANSWER A rooms selling price when
no discounts of any type are offered." "Angelina is the RM at the 1000 room Bay hotel. Tonight she forecasts 600 stay-overs and 400 arrivals. Assume Angelina is accurate in forecasting a 5% no show rate. How many additional
reservations could angelina accept before she would be required to walk an arriving guests? -
CORRECT ANSWER 21 FORMULA= (400 * .05 = 20) - 1000 = 980 on the 21 reservation the
guest would have to be walked."
"At Rachel's hotel the CPOR is $40.00. Her net ADR Yield averages 85% and her franchise fees
average 5%. What is Rachel's average minimum ADR sales point? - CORRECT ANSWER
40.00 / 1.00 - (15 +.05= .20)= 50.00 or 40/.20 = 50.00"
"What is the name for the value given up by a buyer and a seller in a business transaction -
CORRECT ANSWER PRICE"
"What is the formula used to calculate an owners ROI - CORRECT ANSWER Owners
Investment Return/Owners original investment=ROI" "Which of the FOur I's of service refers to the tendency of consumers to equate the quality of
service provided with the attitude of the person who actually provides the service? - CORRECT
ANSWER inseparability"
"Tashia hotel sold 175 rooms last night at an ADR of 200. Her hotel has 250 rooms. What was
Tashias occupancy % last night. - CORRECT ANSWER 70 %"
"What is the industry term for a customer group which can be readily identified by one or more
commom characteristic. - CORRECT ANSWER Market segment"
What is the industry term used to describe the sum of prices paid by a business's customers? -
CORRECT ANSWER Total Revenues"
"Historically, what concept have hospitality managers chiefly used to calculate their selling
prices? - CORRECT ANSWER Costs"
"What is an algebraic equivalent of the formula: Sales = Costs + Profit? - CORRECT ANSWER
Profit = Sales - Costs"
"What is the name for the net value achieved by both parties in a business transaction? -
CORRECT ANSWER Profit"
"What element is not present in a barter economy? - CORRECT ANSWER Money"
"What is the formula used to calculate an owner's ROI? - CORRECT ANSWER Owner's
Investment Return / Owner's Original Investment = Owner's Return on Investment"
"What is the fundamental assumption upon which the Law of Supply is based? - CORRECT
ANSWER The higher the demand for a product the more of it will be produced by sellers"
"According to Alfred Marshall's work, if the price of a product is lower than the natural, or
equilibrium price, what will happen? - CORRECT ANSWER The demand fort he product
would exceed its supply" "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? - CORRECT ANSWER
The new price (P2) would be lower than the previous price (P1) because supply would decrease"
"What concept is displayed by the intersecting point on a supply and demand curve? -
CORRECT ANSWER An estimate of the amount of a product that would be purchased at a
known price and point in time"
"What must be true if a product producer is to continue creating and selling products? -
CORRECT ANSWER Revenues must exceed costs"
"What is the specialized branch of accounting that focuses on recording and analyzing the
expenses incurred by an organization? - CORRECT ANSWER Cost Accounting"
"What is the industry term for the point at which an organization's revenues exactly equal its
costs? - CORRECT ANSWER Break-even point"
"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? - CORRECT ANSWER Because fixed
costs are incurred even if no guests are served or rooms are sold"
"Which of the following statements about unit costs in the hospitality industry is true? -
CORRECT ANSWER Unit costs will vary based upon how high or low an item is priced"
"Which of the following statements about the relationship between costs and pricing is true? -
CORRECT ANSWER An appropriate selling price for a product or service must dictate its
allowable costs" "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?
CORRECT ANSWER An understanding of an organization's customers"
"Which formula represents a buyer's view of a sales transaction? - CORRECT ANSWER
Perceived Value - Selling Price = Personal Profit" "What type of benefit is lacking in material qualities and is not able to be touched or seen but
nonetheless can still be perceived? - CORRECT ANSWER Intangible"
"What will be the typical case in an auction when the initial price bid for the item being sold is
very low? - CORRECT ANSWER The number of potential bidders will be high"
"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? - CORRECT ANSWER Spending her own money on herself"
"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 hotel rooms she will need during her trip? - CORRECT ANSWER
Spending someone else's money on herself" "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? - CORRECT ANSWER Spending her own money
on someone else" "Penny Larson is a travel agent arranging a one-week San Francisco vacation for Mr. and Mrs. Rafael Ochoa. Which of economist Milton Friedman's buyer value formulas would apply to her
purchase of the hotel rooms the Ochoa's will need during their trip? - CORRECT ANSWER
Spending someone else's money on someone else" "What special challenge do buyers of hospitality products such as hotel guestrooms or restaurant
meals face? - CORRECT ANSWER Difficulty in quality evaluation prior to purchase"
"If quantity and quality are held constant how will a reduction in price affect buyers' perceptions
of value? - CORRECT ANSWER Perceived value will increase"
"If quantity and price are held constant how will reductions in product or service quality affect
buyers' perceptions of value? - CORRECT ANSWER Perceived value will decrease"
"Which of the Four I's of service refers to the fact that the quality of service often depends upon
the skill level of the individual who supplies it? - CORRECT ANSWER Inconsistency"
"Offering reduced room rates only to those room buyers willing to book their reservations via an
internet website is an example of which type of differential pricing strategy? - CORRECT
ANSWER Pricing based on distribution channel"
"What is the formula revenue managers use to calculate Net ADR Yield? - CORRECT ANSWER
a. Net Room Rate/Standard ADR = Net ADR Yield" "Offering guests the opportunity to purchase a sandwich, fries and a soft drink at a price lower than that which would be charged for those same items purchased separately is an example of
which type of differential pricing strategy? - CORRECT ANSWER Pricing based on bundling"
"Which statement about revenue management and revenue optimization is true? - CORRECT
ANSWER Revenue management seeks to maximize income while revenue
optimization seeks to maximize long-term profits" "For revenue managers working in the lodging system the term "place" in the 4ps of the Marketing Mix refers to two items. One is the physical location of the hotel. What is the second?
CORRECT ANSWER The property distribution channels"
"What is the industry term used to describe all of a hotels unique or distinct forms of guestroom
products available for sale? - CORRECT ANSWER Rooms inventory"
"What is a rate code? - CORRECT ANSWER A property specific description used to identify a
particular room product" "Which of the following is not typically used by revenue managers to designate specific room
products sold in their hotels? - CORRECT ANSWER Price"
"What is the lodging term used to describe two independent data management systems that have
been electronically connected? - CORRECT ANSWER Interface"
"What would be the effect of an upon-arrival inventory management training program that
resulted in a hotel significantly up selling a large percentage of its arriving guests? - CORRECT
ANSWER ADR and RevPar would increase and occupancy % would be unchanged"
"What are two synonymous lodging industry terms used to identify the difference between
purchases a group pledges to make and the purchases it actually makes? - CORRECT
ANSWER Attrition and wash"
"Expedia.com wants Jesse, the revenue manager at the Hilton, to agree to contract terms that would require Jessie's hotel to apply the agreed upon Expedia rate to any room type (except
suites) available at the time one of Expedia's customers wants to make a reservation. What is the
industry term for Expedia.com's contract request? - CORRECT ANSWER Last room
availability" "Francisco is the revenue manager at the 1500 room BayShore hotel. Tonight he forecasts 750 stay-overs and 750 arrivals. Assume he is accurate in forecasting a 6% no-show rate. How many additional reservations could Angelina accept before she would be required to walk an arriving
guest? - CORRECT ANSWER 90"
"What is true about a revenue manager's rooms demand forecast? - CORRECT ANSWER It is
based on customer demand at an established price" "In the airline industry, airline companies establish ticket prices. In the lodging industry, who is
responsible for establishing room selling prices for hotels that are part of a lodging company? -
CORRECT ANSWER Hotel owners or their designees"
"In the lodging industry, what is a rack rate? - CORRECT ANSWER A room's selling price
when no discounts of any type are offered" "Which of the following is not a strategy typically used by revenue managers to optimize revenue
during periods of high demand? - CORRECT ANSWER Implement rack rate discounts to
maximize occupancy"
"What is true about discounts offered on the selling price of hotel rooms? - CORRECT
ANSWER They should be easily explainable and defensible"
"In which situation would a customer-centric revenue manager likely implement a special event
rate? - CORRECT ANSWER During a local festival that would fill all of the area hotels"
"Hanna is the revenue manger at the Waterford hotel. For a Saturday in the future she has determined her hotel will accept reservation only for those guests seeking to stay for three or more days. Which of the following revenue management control (restriction) strategies is she
using? - CORRECT ANSWER MLOS"
"Bob is the revenue manger at the Waterfront hotel. For the third week in December next year he has determined the hotel will accept reservations for guests seeking to arrive on Dec 21st. Dec 22nd. or Dec 23rd; but not on Dec 24th or Dec 25th. Which of the following revenue management
control (restriction) strategies is she using? - CORRECT ANSWER CTA"
"Which travel industry-related business group developed the Global Distribution System? -
CORRECT ANSWER The airline industry"
"What was the original purpose of THISCO? - CORRECT ANSWER To develop a single GDS
connection for major hotel companies" "What is true about the calculations required to calculate the following Net ADR Yield formula?
Net Room Rate/Standard ADR = Net ADR Yield - CORRECT ANSWER Standard ADR (-)
Distribution Channel Costs (=) Net Room Rate" "What would be the result of a revenue manager's successful implementation of aggressive strategies designed to shift guests' future bookings from more expensive distribution channels to
lesser expense channels? - CORRECT ANSWER Increased Net ADR Yield, increased GOPPOR"
"What is true about rooms that are sold at prices below a hotel's variable operating costs? -
CORRECT ANSWER They will cause an increase in RevPAR"
"Scott is a revenue manager who calculates the following for his hotel: Total (rooms + non-rooms) revenue Total occupied rooms
What is the result of Scott's calculation? - CORRECT ANSWER RevPOR"
"Which is considered a room-related occupancy cost? - CORRECT ANSWER Complimentary
breakfast costs" "At Rachel's hotel the CPOR is $40.00. Her Net ADR Yield averages 85% and her franchise fees
average 5%. What is Rachel's average minimum ADR sales point? - CORRECT ANSWER
"What is the formula used to calculate flow-through for an accounting period? - CORRECT
ANSWER (GOP This Period - GOP Last Period) / (Total Revenues This Period - Total Revenues
Last Period)" "Last month Carl's hotel ran a 55% occupancy. His comp. set had 50,000 room nights available for
sale and sold 25,000 rooms. What was Carl's occupancy index last month? - CORRECT
ANSWER 110%"
"Last month Carl's 500-room hotel had a comp. set that included five additional hotels offering a
total of 2000 rooms. What was Carl's supply share % last month? - CORRECT ANSWER 20%"
"Last month Carl's hotel supplied 10.8% of the rooms in his comp set. It attracted 11.6% of all the rooms sold (demand) and generated 9.1% of the total revenue achieved by the comp set. What is
true about Carl's hotel? - CORRECT ANSWER Its rates are low relative to the comp. set's and
the hotel has an occupancy index above 100%." "What metrics are best used to assess the relative merits of a specific lodging industry
distribution channel's contribution to a single hotel? - CORRECT ANSWER Rooms sold and
Net ADR Yield" "It is near the end of the month and Tamrika is a revenue manager considering the impact of selling 200 room nights, for use this month, but at a room rate far below her hotel's average room
rate. What would be the impact on her hotel's operating statistics if she makes this sale? -
CORRECT ANSWER Increased RevPAR and reduced flow-thru %"
"1. Which of the following statements about restaurant pricing methods is true? - CORRECT
ANSWER Restaurant industry pricing methods are very different from hotel industry pricing
methods" "Shaniqua's restaurant utilizes a product cost percentage pricing system. What should be the selling price for a steak dinner she sells if her total plate cost for the dinner is $7.00 and her
desired product cost is 25%? - CORRECT ANSWER $28.00"
"Shaniqua's restaurant utilizes a product cost percentage pricing system. She would like to apply pricing factors to make pricing her menus easier. What would be the pricing factor she would use
when her desired product cost percentage for an item is 40%? - CORRECT ANSWER 2.5"
"Which menu pricing system would utilize an operation's prime costs when calculating its selling
prices? - CORRECT ANSWER Product Cost: Plus"
"In which menu pricing approach would Menu Engineering as proposed by Kasavana and Smith
be utilized? - CORRECT ANSWER Contribution Margin Pricing"
"What is the common feature in the Product Cost: Plus Pricing, the Contribution Margin Pricing
and the Product Cost Percentage Pricing systems? - CORRECT ANSWER The amount paid for
products" "For revenue managers seeking to optimize revenues in their foodservice operations, which
statement about menu prices is true? - CORRECT ANSWER An appropriate menu price
should dictate an item's cost"
