Which pricing term describes the base price before discounts?

Which pricing term describes the base price before discounts?

• A. Loyalty Program
• B. Run of the House
• C. Rack Rate
• D. Promotional Rate

Answer: (C)

Rack rate is the base price for a hotel room before any discounts or promotions are applied. It’s the published standard rate shown on rate sheets or the hotel’s website, serving as the reference point you compare deals against. Discounts from loyalty programs, promotional offers, or negotiated rates come off this price, not from a lower starting point. Run of the House describes getting any available room at the prevailing rate at check-in, rather than a specific base price; it’s not the fixed base price itself. A loyalty program is about member benefits and potential discounts, while a promotional rate is a time-limited discount. So the rack rate is the baseline price before those reductions.

Rack rate is the base price for a hotel room before any discounts or promotions are applied. It’s the published standard rate shown on rate sheets or the hotel’s website, serving as the reference point you compare deals against. Discounts from loyalty programs, promotional offers, or negotiated rates come off this price, not from a lower starting point. Run of the House describes getting any available room at the prevailing rate at check-in, rather than a specific base price; it’s not the fixed base price itself. A loyalty program is about member benefits and potential discounts, while a promotional rate is a time-limited discount. So the rack rate is the baseline price before those reductions.