The following graph input tool shows the daily demand for hotel rooms at the Peacock Hotel and Casino in Las Vegas, Nevada. To help the hotel management better understand the market, an economist identied 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 Round trip airfare from New York (JFK) to Las Vegas (LAS) $100 per round trip Room rate at the Grandiose Hotel and Casino, which is near the Peacock $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 eld, the graph and any corresponding amounts in each grey field will change accordingly. Graph Input Tool Market for Peacock's Hotel Rooms | Price ( Dollars per room) 200 uantity cDzemanded 350 (Hotel rooms per night) Demand Factors Average Income (Thousands of dollars) PRICE (Dollars per room) Airfare from JFK to LAS (Dollars per round 0 50 100 150 200 250 300 350 400 450 500 trip) QUANTITY (Hotel rooms) Room Rate at Grandiose (Dollars per night) For each of the following scenarios, begin by assuming that all demand factors are set to their original values and that Peacock 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 Peacock v from rooms per night to :l rooms per night. Therefore, the income elasticity of demand is V , meaning that hotel rooms at the Peacock are v . If the price of an airline ticket from JFK to LAS were to increase by 10%, from $100 to $110 round trip, while all other demand factors remain at their initial values, the quantity of rooms demanded at the Peacock v from C] rooms per night to: rooms per night. Because the cross elasticity of demand is V , hotel rooms at the Peacock and airline trips between JFK and LAS are V . Peacock is debating decreasing the price of its rooms to $175 per night. Under the initial demand conditions, you can see that this would cause its total revenue to v . Decreasing the price will always have this effect on revenue when Peacock is operating on the v portion of its demand curve