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Draw and upload a graph with supply and demand curves (and any explanation necessary) to show...

Draw and upload a graph with supply and demand curves (and any explanation necessary) to show the impact on equilibrium price for the leisure travel services market as more of the population retires.

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Answer #1

With an increase in retirement of population, people will get more leisure time and they will demand more leisure travel.

This will increase the demand in leisure travel services market.

As a result, the demand curve will shift rightwards. This will lead to increase in equilibrium price for the leisure travel services.

It can be shown with the help of following diagram:

With an increase in demand for leisure travel, it will lead to shift in demand curve from D1 to D2 and as a result of this, equilibrium price will rise from P1 to P2. New equilibrium level will be set up in the market at point E2.

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