Hotel Management - Qp2

Investment refers to the act of acquiring or purchasing fixed assets. It involves the expenditure of funds to acquire long-term assets such as land, buildings, machinery, or equipment. The purchase of fixed assets is considered an investment because it is expected to generate future economic benefits for the business. On the other hand, the sale of fixed assets would result in a decrease in the company's investment in those assets. Therefore, the correct answer is "purchase" as it accurately describes the action of acquiring fixed assets.

Firms expand by moving into different markets and selling different products. This means that they enter new markets and offer a variety of products to customers. Selling different products allows firms to cater to different customer needs and preferences, increasing their market reach and potential revenue. By diversifying their product offerings, firms can also mitigate risks associated with relying on a single product or market. Overall, selling different products is an essential strategy for firms to grow and expand their business.

The statement suggests that most units in the restaurant and hotel sections of the industry are large. However, this is not necessarily true as there are various sizes of units in these sectors. Some restaurants and hotels can be small, while others can be large. Therefore, the statement is false.

Perfect competition exists when there are many buyers and sellers of a product, and none of their actions affect the price. This means that individual buyers and sellers have no control over the market price and must accept it as given. Additionally, there must be no barriers to entry into the industry, allowing new firms to easily enter and compete. Finally, the units of labor must be homogeneous, meaning that there is no differentiation among workers in terms of skills or productivity. These conditions ensure that the market is competitive and that no individual buyer or seller has the power to influence prices.

The demand for hotel and catering services does not depend on just five main factors. There could be several other factors that influence the demand for these services, such as economic conditions, customer preferences, competition, location, and marketing strategies. Therefore, the statement that the demand depends only on five main factors is incorrect.

The correct answer is "low". This means that the membership of the trade union movement in the hotel and catering industry is not very high. It suggests that a small percentage of workers in this industry are part of a trade union. This could be due to various factors such as the nature of the industry, the working conditions, or the lack of awareness or interest among workers in joining a trade union.