For each of the following scenarios, begin by assuming that all demand factors are set to their original values and Rivers is charging $100 per room per night. If average household income increases by 20%, from $50,000 to $60,000 per year, the quantity of rooms demanded at the Rivers rooms per night to rooms per night. Therefore, the income elasticity of demand is from meaning that hotel rooms at the Rivers are If the price of a room at the Continental were to decrease by 20%, from $200 to $160, while all other demand factors remain at their initial values, the quantity of rooms demanded at the Rivers rooms per night to rooms per night. Because the cross-price elasticity of demand is from hotel rooms at the Rivers and hotel rooms at the Continental are Rivers is debating decreasing the price of its rooms to $75 per night. Under the initial demand conditions, you can see that this would cause its total . Decreasing the price will always have this effect on revenue when Rivers is operating on the revenue to portion of its demand curve. ت The following graph input tool shows the daily demand for hotel rooms at the Rivers Hotel and Casino in Atlantic City, New Jersey. To help the hotel management better understand the market, an economist identified three primary factors that affect the demand for rooms each night. These demand factors, along with the values corresponding to the initial demand curve, are shown in the following table and alongside the graph input tool. Demand Factor Average American household income Roundtrip airfare from Des Moines (DSM) to Atlantic City (ACY) Room rate at the Continental Hotel and Casino, which is near the Rivers Initial Value $50,000 per year $200 per roundtrip $200 per night Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. 500 450 400 PRICE (Dollars per room) 350 300 250 200 150 100 50 0 0 Demand 50 100 150 200 250 300 350 400 450 500 QUANTITY (Hotel rooms) Graph Input Tool Market for Rivers's Hotel Rooms Price 100 (Dollars per room) Quantity 400 Demanded (Hotel rooms per night) Demand Factors Average Income 50 (Thousands of dollars) Airfare from DSM to 200 ACY (Dollars per roundtrip) Room Rate at 200 Continental (Dollars per night) (?