The following graph input tool shows the daily demand for hotel rooms at the Triple Sevens Hotel and Casino in Las Vegas, Nevada. 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 Initial Value Average American household income $50,000 per year Roundtrip airfare from San Francisco (SFO) to Las Vegas (LAS) $100 per roundtrip Room rate at the Exhilaration Hotel and Casino, which is near the Triple Sevens $250 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. Graph Input Tool (?) 500 Market for Triple Sevens's Hotel Rooms Price 200 (Dollars per room) Quantity 300 Demanded (Hotel rooms per night) PRICE (Dollars per room) Demand Factors Demand Average Income 50 (Thousands of dollars) Airfare from SFO to 1001 LAS "Dollars per 0 50 100 150 200 250 300 350 400 450 500 roundtrip) QUANTITY (Hotel rooms) Room Rate at 250 Exhilaration (Dollars per night)5m Market for Triple Sevens's Hotel Rooms 45 - 4-00 (Dollars per mom) - Quanti E 350 Deman ed 300 2 (Hotel' moms per a 300 night) D. E 250 a 2m Demand Factors 6 _ 150 Average Income E mmm D. \"'0 dollars} 5'3 Airfare from SFO to L... 0 (Dollars per D so no 150 2oo 250 zoo 350 m0 450 sec WUHdM'PJ QUANTITY {Hotel rooms) Room Rate at Exhilaration (Dollars per night) For each of the following scenarios, begin by assuming that all demand factors are set to their original values and Triple Sevens is charging $200 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 Triple Sevens V from |:| rooms per night to E rooms per night. Therefore, the income elascity of demand is V , meaning that hotel rooms at the Triple Sevens are v . If the price of an airline ticket from SFO to LAB were to increase by 10%, from $100 to $110 roundtlip, while all other demand factors remain at their initial values, the quantity of rooms demanded at the Triple Sevens V from |:| rooms per night to E rooms per night. Because the crossprice elascity of demand is V , hotel rooms at the Triple Sevens and airline trips between SF0 and LAS are V . Triple Sevens is debating decreasing the price of its rooms to $1}'5 per night. Under the initial demand conditions, 1.I'ou can see that this would cause its total revenue to V . Decreasing the price will always have this effect on revenue when Triple Sevens is operating on the v portion of its demand curve