9. Application: Elasticity and hotel rooms The following graph input tool shows

Question

9. Application: Elasticity and hotel rooms 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 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 Average American household income Roundtrip airfare from San Francisco (SFO) to Las Vegas (LAS) Room rate at the Grandiose Hotel and Casino, which is near the Peacock Initial Value $50,000 per year $250 per roundtrip $200 per night

Explanation / Answer

The existence of a firm as a business organisation is valid. Now why firm exist as organisation. An organisation has some characteristics like team work, leadership, sharing the goal of organisation among employees, employee morale, risk and opportunities, adapts with risk and opportunities. Now as a firm all those things which the organisation has exist. First in a firm there is a team work. Employees in a firm work as a team. In the firm there is a leader who controll the production and manage the employees. There is risk and opportunities in the firm also. So all the characteristics the organisation has the firm also has those characteristics. Actually firm is small part of organisation. So firm will always exist as a organisation.

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