Rev Mngmnt Quiz Ch. 10 – Flashcards

Which of the following statements about restaurant pricing methods is true? A. The menu pricing methods used by restaurateurs have changed radically in the past two decades. B. Discounting for quantity purchase is one of the primary pricing methodologies used by restaurateurs C. Restaurant industry pricing methods are very different from hotel industry pricing methods D. In most cases the task of pricing menu items is assigned to a revenue management specialist

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%? A. $28.00 B. $3.57 C. $10.00 D. $35.71

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%? A. 2.5 B. 250 C. .25 D. 25

Which menu pricing system would utilize an operation's prime costs when calculating its selling prices? A. Differential pricing B. Contribution Margin C. Product Cost Percentage D. Product Cost: Plus

In which menu pricing approach would Menu Engineering as proposed by Kasavana and Smith be utilized? A. Plate Cost Pricing B. Product Cost Percentage Pricing C. Contribution Margin Pricing D. Product Cost: Plus Pricing

What is the common feature in the Product Cost: Plus Pricing, the Contribution Margin Pricing and the Product Cost Percentage Pricing systems? A. The amount paid for labor and products B. The amount paid for labor C. The amount paid for prime costs D. The amount paid for products

For revenue managers seeking to optimize revenues in their foodservice operations, which statement about menu prices is true? A. An item's prime costs should be dictate its menu price B. An increase in an item's cost dictates an increase in its menu price C. An item's cost should dictate its menu price D. An appropriate menu price should dictate an item's cost

Shaniqua's restaurant utilizes a product cost percentage pricing system. She would like to sell an item for $19.95. Her targeted product cost is 40%. With a 40% product cost, what is the amount her kitchen staff can spend on product cost when making this item? A. $0.80 B. $7.98 C. $4.00 D. $4.99

Shaniqua's restaurant utilizes a contribution margin pricing system. She would like the selling price of a new menu item she is introducing to be $10.00. Her required contribution margin is $4.00. Her labor costs are 30%. What is the amount her kitchen staff can spend on product cost when making the item? A. $7.00 B. $6.00 C. $2.50 D. $3.00

Why can foodservice operators sell a 20 year Scotch at a price higher than a one year old Scotch? A. The cost to the operator of a 20 year old Scotch is higher than a one year old Scotch B. One year old Scotch is not popular C. Customers prefer to pay higher prices D. The quality of a 20 year old Scotch is higher than a one year old Scotch

Assume a food and beverage operator offers guests a 20-year old Scotch at a price five times the amount charged for one-year old Scotch. Assume also that the operator's customers very rarely purchase the more expensive Scotch. Which statement would explain why the 20 year old Scotch does not sell well? A. The 20-year old Scotch is priced too low B. Customers do not accept this seller's price-value proposition C. The cost to the operator of the 20-year old Scotch is too high D. The quality of the 20-year old Scotch is too low compared to the one-year old Scotch

Arthur's restaurant is extremely busy on Friday and Saturday. The manager of the operation offers reduced prices on quick-to-prepare and quick-to-serve menu items on those two nights. What revenue related factor is this restaurant manager seeking to positively influence? A. costs B. check average C. capacity D. contribution margin

Poco Miller's restaurant has 130 seats. Last night Poco served 295 guests. What was is the formula Poco would use to calculate her table turns? A. 130 (x) 295 = table turns B. 295 / 130 = table turns C. 295 (x) 130 = table turns D. 130 / 295 = table turns

Texas Roadhouse restaurants do not accept reservations. Guests who call ahead, however, can have their names added to the wait list prior to arriving at the restaurant. What revenue-related factor is this strategy designed to optimize? A. capacity B. sales mix C. guest type D. contribution margin

Why should revenue managers monitor their competitors' prices? A. to keep their own prices in the middle of their competitor's price ranges B. to keep their own prices on the lower end of their competitor's price ranges C. to keep their own prices well below those of their competitors D. to keep their own prices on the higher end of their competitor's price ranges

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? A. Portion size B. service level C. meal period D. competition

Offering the same menu item in a variety of portion sizes is an example of what type of differential pricing strategy? A. time B. bundling C. product versioning D. customer characteristic

Last night Lara's restaurant served 225 guests and achieved total revenue of $4,500. What was Lara's check average last night? A. $101.25 B. $50.00 C. $20.00 D. $10.13

What foodservice value-related factor is most affected when a revenue manager successfully implements a price blending strategy? A. portion size B. image C. menu mix D. service level

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? A. the sales mix B. the number of guests served C. a variation in service levels D. a variation in product costs