what is the price elasticity of demand for (i) business tourists and (ii) vacationers? ii. Why might vacationers have a different elasticity than business tourists?
what is the price elasticity of demand for (i) business tourists and (ii) vacationers? ii. Why might vacationers have a different elasticity than business tourists?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
a. Suppose that business tourists and vacationers have the following demand for
hotels in Bahamas:
Price ($) Quantity Demanded
(Business Tourists)
Quantity Demanded
(Vacationers)
200 3000 1500
250 2800 1200
300 2600 900
350 2400 600
i. As the price of hotel rooms rise from $250 to $350, what is the price
elasticity of demand for (i) business tourists and (ii) vacationers?
ii. Why might vacationers have a different elasticity than business
tourists?
b. Using the table below:
i. Calculate the cross-price elasticity of broccoli.
ii. Are fish and broccoli complementary or substitute goods?
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