Does the following case violates the law of demand?

2007-05-17 8:23 pm
Regal Hotels report that their room rates rose by 11% and their room occupancy rate increased by 3.4% in 2005. Does thid violoate the law of demand? Why or why not? If possible, please explain with a diagram.

回答 (2)

2007-05-17 8:33 pm
✔ 最佳答案
If the room rates incresase , room occupancy rates will increase, this is not the law of demand. the demand of room unchange and the demand curve unchange, but the supply curve shift to the right mean the room supply increase., then the price will drop as the room supply increase.


Please see the folloing link for your reference.

http://www.netmba.com/econ/micro/supply/curve/

2007-05-17 12:33:38 補充:
http://en.wikipedia.org/wiki/Supply_and_demand
2007-05-19 6:22 pm
Think : why they increase room rate by 11% first,
assume that they upgrade their hotel room and service,

That means : change to a new Supply and Demand platform.
they may targeting new group of customer base using their different
marketing strategy.
eg. go to the high end market, etc....

My point is : A Complete NEW set of Demand and Supply Curve is drawing by Regal's
management team.

So, Marketing and Economices works together.


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