Answer:
Check the explanation
Explanation:
Whenever there’s a $300 charge from the Big Winner, and normal household income is expected to be around $50,000, it can fill 200 rooms per night at that price. Though, if there’s an increase in a typical household income to $55,000, the quantity of rooms that would be demanded will rises to 300 rooms per night. You can calculate the income elasticity of demand for Big Winner's hotel rooms by dividing the percentage change in quantity demanded by the percentage change in income:
Income Elasticity of Demand Income Elasticity of Demand =
= Percentage Change in Quantity Demanded,
Percentage Change in Income
Percentage Change in Quantity Demanded
Percentage Change in Income
=250 = 50%10% 50%10% = 5 5