Attempts Keep the Highest /3 Application: Elasticity and hotel rooms The following graph input tool shows the daily demand for hotel rooms at the Oceans 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. 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. For each of the following scenarios, begin by assuming that all demand factors are set to their original values and Oceans is charging $350 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 Oceans from rooms per night to rooms per night. Therefore, the income elasticity of demand is , meaning that hotel rooms at the Oceans ar If the price of an airline ticket from PIT to ACY were to increase by 10%, from $200 to $220 roundtrip, while all other demand factors remain at their initial values, the quantity of rooms demanded at the Oceans fi rooms per night to rooms per night. Because the cross-price elasticity of demand is , hotel rooms at the Oceans and airline trips between PIT and ACY ar Oceans is debating decreasing the price of its rooms to $325 per night. Under the initial demand conditions, you can see that this would cause its total revenue . Decreasing the price will always have this effect on revenue when Oceans is operating on the portion of its