MH42 2.01 Economic impacts to H&T

Which factor is most likely to have a positive impact on a destination’s ability to attract tourists?

• Increase in sales tax

• Increase in crime

• Fluctuations in interest rates

• Improvements to the infrastructure

Tami is coordinating for a concert of about 30,000 attendees. She is also coordinating with local hotels. Which activity is she addressing?

• The inflation rate increases.

• The demand for hotel rooms increases.

• The demand for transportation decreases.

• The local economy experiences a contraction.

What tends to occur when a nation’s economy experiences an economic recession?

• Lodging facilities expand their operations.

• The food and beverage industry grows rapidly.

• Consumers save their money and reduce their travel.

• The workforce grows and spends less money on tourism.

Which economic indicators suggests that a country is likely to experience an overall increase in domestic travel and tourism?

• Sales taxes increase.

• Consumer spending increases.

• The standard of living decreases.

• The strength of the U.S. dollar decreases.

During which phase of the business cycle is travel and tourism most likely to increase?

• Trough

• Contraction

• Expansion

• Recession

When tourists spend money at local attractions, the employees working at the local attractions earn income and spend a portion of their money at local restaurants and stores. Which concept does this situation illustrate?

• The economic multiplier

• The competitive advantage

• The channels of distribution

• The law of diminishing returns

What is the typical result when a destination’s hospitality and tourism businesses continuously attract visitors?

• The local economy thrives.

• The local economy declines.

• Local businesses are more likely to fail.

• Local residents have less money to spend.

Why do popular vacation destinations tend to experience economic highs and lows at certain times of the year?

• Tourists want to visit new places.

• Travel and tourism are cyclical.

• Airlines overbook their flights.

• Airport hubs close during certain seasons.

Which process has led to an interdependency of travel and tourism activities among different countries to strengthen their national economies?

• Globalization

• Protectionism

• Domestic Trade

• Industrial Positioning

How does a high level of inflation affect the hospitality and tourism industry?

• Tourists have more money to spend.

• Tourists’ purchasing power decreases

• Hospitality and tourism businesses hire more employees.

• Hospitality and tourism businesses typically lower their prices.