Deck 2: The Hotel Business

Question 1

Hotels may be classified by

A) size
B) Location, price and service
C) type of recreational facilities
D) country

Answer 1

Location, price and service

Question 2

Lack of operational power, high fees, low percentage of reservations from the central reservation system are all ________ of franchising.

A) benefits
B) drawbacks
C) trends
D) bonuses

Answer 2

drawbacks

Question 3

Corporations that operate a hotel without capital outlay in exchange for a percentage of gross sales are known as

A) leasing companies
B) vacation brokers
C) management companies
D) franchisees

Answer 3

management companies

Question 4

Airport hotels

A) are generally not full service
B) range from 200-600 rooms with full service
C) face less competition than other types of hotels
D) are often smaller, budget hotels

Question 5

Franchising hotels was begun in 1907 by

A) Howard Johnson company
B) Marriott
C) The Ritz Company
D Holiday Inn

Question 6

Examples of hotel location include

A) city, resort, airport, freeway
B) luxury, all suites, economy, budget
C) full service, mid-scale, extended stay, limited service
D) spa, convention, casino, bed and breakfast

Question 7

Examples of hotel level of service classification include

A) city, resort, airport, freeway
B) luxury, all suites, economy, budget
C) full service, mid-scale, extended stay, limited service
D) spa, convention, casino, bed and breakfast

Question 8

All of the following are benefits of a city center hotel EXCEPT:

A) public transportation is available
B) variety of services and accommodations
C) typically have a signature restaurant
D) room prices are usually in the luxury segment

Question 9

Franchising is

A) not widely used in the hospitality industry
B) used in the hospitality industry to rapidly expand business
C) a concept that allows a company to use other peoples money for growth rather than financing
D) B and C

Question 10

In order to determine if a hotel development project would likely succeed, we would perform a(n)

A) property appraisal
B) operating assessment
C) trust initiative
D) feasibility study

Question 11

In this type of "ownership" investors do not pay corporate income tax, however they distribute the majority of net income to shareholders, and are publicly traded.

A) Franchises
B) Independent ownership
C) Partnerships
D) Real estate investment trusts

Question 12

An organization that rates and classifies hotels and awards them Diamonds is the

A) United States Automobile Club
B) Exxon Excellence Association
C) American Hotel & Motel Association
D) American Automobile Association

Question 13

Casino hotels

A) are becoming more family friendly
B) are marketing themselves as business hotels
C) make more money from gaming than from rooms
D) are focusing more on the budget traveler

Question 14

In franchising the franchisee is granted rights to

A) full ownership of the building
B) full ownership of the land
C) change the name of the business
D) use trademarks, operating procedures and other business procedures

Question 15

Hotels and motels that are part of a ________ share a centralized reservation system and a common image, logo or advertising slogan.

A) referral association
B) REIT
C) franchise
D) proprietorship

Question 16

Marriott builds a hotel for $34 million and sells it to a banking firm for $52 million. Marriott charges the banking firm 2-4 % of gross revenues to operate the hotel. This business transaction is known as

A) franchising
B) management contract
C) REIT
D Investment Partnership

Question 17

Examples of hotel price classification include

A) city, resort, airport, freeway
B) luxury, all suites, economy, budget
C) full service, mid-scale, extended stay, limited service
D) spa, convention, casino, bed and breakfast

Question 18

Purchasing the right to use a company's trademark and copyrighted materials is known as

A) a partnership
B) leasing
C) franchising
D) syndication

Question 19

The benefits of franchising include all of the following EXCEPT:

A) set of plans and specifications for building
B) national advertising
C) participating in the volume purchasing discounts
D) high fee percentages charged by credit card companies

Question 20

City center, resort, airport and freeway are all examples of hotels being classified by

A) location
B) price
C) service
D) amenities

Question 21

The fastest growing segment of the travel industry is

A) resort hotels
B) city center hotels
C) cruise ships
D) vacation ownership

Question 22

The Greenbrier, the Halekulani and the Ritz Carlton Kapalua are all examples of

A) boutique hotels
B) full-service hotels
C) convention hotels
D) resorts

Question 23

List three popular forms of ownership used in the lodging industry that allow for rapid expansion.

Question 24

List five factors involved in the growth of franchising.

Question 25

List and describe/provide examples of the five ways in which hotels are classified.

Question 26

List the six main types of hotels by price segment and give two examples of each. Outline a general profile of the typical customer for each segment.

Question 27

Compare and contrast the following concepts: franchise, partnership, leasing and syndication.

Question 28

Discuss marketability of the sustainable hotel industry. Discuss costs versus a standard hotel, guest demographic, and the positive or negative impact in the local community.

Question 29

Of the ten hotel classifications, select five and give a general description of the types of hotels in each segment. Be sure to include price, location, and degree of service and target market.

Question 30

Mixed-use hotel development indicates that

A) a hotel can be used for meetings and lodging
B) a hotel may also have residences
C) a hotel serves food
D) a hotel is near transportation

Question 31

As the hotel industry matures, corporations are either acquiring or merging with each other. This is

A) consolidation
B) capacity control
C) diversification
D) safety and security