If a Hotel Has the Highest Average Rate in the Market

question 28

Multiple Choice

If a hotel has the highest average rate in the market it

• A)is the rate leader in the market.
• B)usually has a high occupancy as well.
• C)has a high Revpar.
• D)is making a lot of money.

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Definitions:

Activity Rates

The charges or costs applied to specific activities or cost drivers in activity-based costing.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to specific products or projects based on their activity levels.

Overhead Cost

Expenses that are not directly attributed to creating a product or service but are necessary for running the business, such as rent, utilities, and office supplies.

Products

Items or goods that are manufactured or refined for sale.