Kristy, Managerial Economics

Rail Tours sells packaged tours on rail lines, including gourmet meals and a reserved bed. The most popular tours are in the autumn when colors are at their peak. The overnight package for Saturday and Sunday morning are especially heavily booked. A market survey firm has just completed a study in which they conclude that if the package cost is $200 per couple, then Rail Tours can expect to sell 400 spaces on a typical Saturday. If the prices is raised to $225, unit sales drop to 380. The survey firm also reports that if per-capita income changes, Rail Tours can expect a large change in bookings. In particular, if per-capita income falls by 1%, then bookings will probably fall by 2%.
a. If the demand curve is extrapolated from the data points given, what is the equation for demand? Are there any precautions in extending the curve in this matter?
b. Are tours normal or inferior goods? Why?
c. If you were responsible for making a forecast for bookings, would you accept this forecast as is? Would you wand additional information about demand? If so, what sort? Explain.
Posted Date: 11/12/2012 5:57:36 PM | Location : United States







Related Discussions:- Kristy, Assignment Help, Ask Question on Kristy, Get Answer, Expert's Help, Kristy Discussions

Write discussion on Kristy
Your posts are moderated
Related Questions
PHILLIPS CURVE   The Phillips  curve,  named  after  A.  W.  Phillips,  describes  the  relationship between unemployment  and  inflation. In  1958  Phillips, then  professor a

wHAT IS THE SIGNIFICANCE OF EXPECTATION ELASTICITY ?

break event point

Illustrate about forecasting in management A forecast expert has been asked to provide quarterly estimates of the sales volume for a specific product for the next four quarters

Based on the information given in the Canada Health Act as well as the information given in your Study Guide, write a description of how medical services are funded in Canada. Be s

Suppose that there is a fixed sum of money available to be spent on public projects, and that a large number of public projects have been evaluated using social cost-benefit analys

Nature and Functions of Money The concept of money is very difficult to define . it is belongs to the category of things which are not amenable to any single definition. It is p

A chemical producer dumps toxic waste into a river. The waste decreases the population of fish, decreasing profits for the local fishing industry by $100,000 per year. The firm cou

Q. Example on Changes in fixed costs and profit maximisation? What if arena owner in the illustration above triples the fee for the subsequent concert but all other factors are

To what extent has the IMF achieved its objectives? The objective of achieving full convertibility of currencies has not been achieved.  In the first place countries impose re