What would the price elasticity of demand equal if the price of a hotel room increases from $70 to $85 and the number of rooms booked decreases from 200 to 150?

Usually, businesses will analyze the price elasticity of demand regarding the costs and purchases in their company. The price elasticity of demand refers to the way in economics that shows the growth and decrease in the number of goods compared to the price. The only change that takes place would be the price change. No other change could take place.

For example, if there was a hotel. This hotel made one change and then wanted to see how that affected their business; they would only change the price. They increase the rate of fifteen extra dollars for the cost of booking a room. Then they see that the number of reserved rooms decreased from 200 to 150. The price elasticity of demand would be 48.