CTC Business Management & Ethical Practices 3 — Questions and Answers
Question 1: A CTC realizes she booked a client into the wrong hotel category. The ethical course of action is to:
- Inform the client promptly and correct the error (Correct answer)
- Say nothing and hope the client doesn't notice
- Charge the client for the more expensive room silently
- Cancel the whole trip to avoid blame
Correct answer: Inform the client promptly and correct the error
Honesty and prompt correction uphold the client's trust and interests.
Question 2: What is the primary purpose of a break-even analysis for a travel agency?
- To determine the sales level where revenue equals total costs (Correct answer)
- To calculate employee vacation days
- To measure customer satisfaction
- To set supplier commission rates
Correct answer: To determine the sales level where revenue equals total costs
Break-even analysis identifies the point at which the business covers all its costs.
Question 3: Under most consumer-protection laws, what must a travel counselor do regarding cancellation penalties?
- Clearly disclose them before the client pays (Correct answer)
- Reveal them only after booking
- Hide them to avoid discouraging sales
- Assume the client already knows them
Correct answer: Clearly disclose them before the client pays
Full disclosure of penalties before purchase is an ethical and legal requirement.
Question 4: Which leadership approach best fosters accountability among agency staff?
- Setting clear expectations and measurable goals (Correct answer)
- Avoiding all performance feedback
- Micromanaging every task
- Withholding information from the team
Correct answer: Setting clear expectations and measurable goals
Clear goals and expectations let staff take ownership of results.
Question 5: A travel agency's gross profit margin is calculated as:
- (Revenue minus cost of sales) divided by revenue (Correct answer)
- Total revenue minus payroll only
- Net income divided by total assets
- Commissions minus taxes
Correct answer: (Revenue minus cost of sales) divided by revenue
Gross profit margin shows the percentage of revenue remaining after direct costs.
Question 6: If a client requests an itinerary that appears to facilitate illegal activity, the CTC should:
- Decline to arrange the booking (Correct answer)
- Proceed if the commission is high
- Ask no questions and complete it
- Refer the client to a competitor to keep the commission
Correct answer: Decline to arrange the booking
A professional must not knowingly assist in unlawful conduct.
Question 7: Why should an agency maintain a written privacy policy?
- To inform clients how their personal data is collected and used (Correct answer)
- To increase supplier commissions
- To replace the need for insurance
- To eliminate all marketing
Correct answer: To inform clients how their personal data is collected and used
A privacy policy discloses data-handling practices and builds client trust.
CTC Business Management & Ethical Practices 3
A CTC realizes she booked a client into the wrong hotel category.
The ethical course of action is to: