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. 0 50 100 150 200 250 300 350 400 450 500 500 450 400 350 300 250 200 150 100 50 0 PRICE (Dollars per room) QUANTITY (Hotel rooms) Demand Graph Input Tool Market for Peacock's Hotel Rooms Price (Dollars per room) Quantity Demanded (Hotel rooms per night) Demand Factors Average Income (Thousands of dollars) Airfare from JFK to LAS (Dollars per roundtrip) 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 Peacock is charging $300 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 fromrooms per night torooms per night. Therefore, the income elasticity of demand is , meaning that hotel rooms at the Peacock are . If the price of an airline ticket from JFK to LAS 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 Peacock fromrooms per night torooms per night. Because the cross-price elasticity of demand is , hotel rooms at the Peacock and airline trips between JFK and LAS are . Peacock is debating decreasing the price of its rooms to $275 per night. Under the initial demand conditions, you can see that this would cause its total revenue to . Decreasing the price will always have this effect on revenue when Peacock is operating on the portion of its demand curve.