CHIA Hotel Industry Exam Practice 2025 – Comprehensive Prep

RevPAR stands for Revenue Per Available Room. This key performance metric in the hospitality industry provides insight into how well a hotel is performing in terms of generating revenue from its available rooms. It is calculated by multiplying the average daily room rate (ADR) by the occupancy rate or by dividing total room revenue by the number of available rooms. Understanding RevPAR is crucial for hotel managers and investors as it helps to assess the effectiveness of a hotel’s revenue management strategies and its overall financial health.

The other options do not accurately define RevPAR, with each presenting variations that alter the original meaning. For instance, while "Revenue Per Average Room" and "Revenue Performance Average Room" may seem related, they do not correctly describe the standard industry term, which focuses specifically on room availability rather than averages or performance. "Room Revenue Per Available Room" also complicates the term unnecessarily, as it does not succinctly convey the direct relationship between room revenue and availability that is inherent in the standard definition of RevPAR. Thus, the correct answer efficiently encapsulates the essential purpose of the metric as it is recognized in the hotel industry.