Small Leaf Resort and Cresgrove Resort are established hotels in the hospitality industry.However,Small Leaf Resort has a larger net profit than that of Cresgrove Resort.In order to remain financially viable in the hospitality market,Cresgrove Resort decides to charge more for their rooms and other services.In this scenario,which of the following best explains the reason behind Cresgrove Resort incurring losses?
A) Cresgrove Resort has high labor-related expenses.
B) Cresgrove Resort hires employees belonging to the age group of 15 to 20.
C) Cresgrove Resort has better quality and customer service than Small Leaf Resort.
D) Cresgrove Resort considers its employees as resources.
E) Cresgrove Resort's compa-ratio is less than 1.

Question

Quizplus · Accepted Answer

If an organization's labor costs are higher than those of its competitors, it will be under pressure to charge more than competitors charge for similar products.

Small Leaf Resort and Cresgrove Resort Are Established Hotels in the Hospitality