country
$20 Bonus + 25% OFF
Securing Higher Grades Costing Your Pocket? Book Your Assignment at The Lowest Price Now!

Question:

Using demand and supply fundamentals, explain why prices in school holidays are often higher than in school terms?
 
 

Answer:

Demand And Supply Of Tourism

Tourism industry is not only signified as the pleasure industry offering leisure, refreshment and enjoyment but it also plays an economic role. (Biggs, 2010)

Economic Factors Considered For Price Setting

The economic factors that determines the price of the tour package depends on the consumer preference regarding the choice of destination, travel season, mode of transport, food options while the travel and other expenses involved in exploring the destination. (https://www.destinationnsw.com.au, 2015) This involves the cost of the arrangements which derives the price of tour packages. Another important factor is the price charged by the competitor which alters the pricing strategy of the tour operators. They would try to lower the price than the rival operator in order to gain the market share. (Kozak, Gnoth and Andreu, 2010) (Spilsbury, 2011)

Price Rise In School Holidays (By Demand And Supply Analysis)

The fundamental concept of economics is the determination of equilibrium price and quantity based on the market demand and supply. Based on the question provided we frame a demand and supply mechanism where tour package is the good and price of the product is the price of the tour packages. (Hall, 2010)

There is a negative relationship between the price of the tour package and the demand for tour packages so the demand curve for the tour packages is downward sloping. (Matias, Nijkamp and Sarmento, 2013)

 

Now the supply of the tour package has a positive relationship with its price. Thus the supply curve of the tour package is a upward sloping. . (Anon, 2015)

The intersection of the supply and demand curve yields the equilibrium price and quantity of the tour package. The following diagram shows the fundamentals of the demand and supply of the tour packages. (Turaev, 2010)

We consider that during the school holidays, the price of the tour packages tend to increase compared to the time period when the schools are open. (Yong, 2014)This can be explained from the fact that during vacations, the children get free time which they want to utilize by visiting places for fun and recreation. Now the suppliers of the tour packages are aware of the phenomenon that the children and their parents would be interested to go out on vacations only when the schools of their children have declared holidays. With this fact, the tour operators know that the demand for tour package will increase in this time. This would create a situation of excess demand and drive up the price of the tour packages. . (https://www.tourism.umn.edu, 2012)

The above diagram shows that during the school holidays, the demand for tour packages increases which is depicted by the shift of the demand curve from D to D1. Then there arises an excess demand in the market which drives up the price from P* to P1. Thereby the quantity of tour packages also increased from Q* to Q1. (Vanhove, 2011)

Risk Factors In Pricing

The pricing strategy of the international tourism depends on several risk factors. The fluctuation in the exchange rate is one such risk factor that alters the decision of the tourist. If the exchange rate variation is unfavorable then the tourist would decrease their visits to abroad as the foreign currency had become expensive. The tourist can completely change the destination of travel from international to national places, cut down his expenses and decrease the number days of his stay, and also change the mode of travel and even can decide to travel in another season. All these would lead to a decline in the demand resulting in a situation of excess supply. The tour operators would lower the price to maintain market stability. (De Vita, 2014)

When the exchange rate changes in favor of the tourists then the opposite happens. Now as the foreign currency has become cheaper, the tourist can make frequent visit to abroad and make purchases of international tour package, can buy additional goods and services, stay longer in a particular foreign destination and can even avail the expensive mode of transport. All these will augment the demand for tour packages and create a situation of excess demand. Capturing this market condition the tour operators will increase the price of tour packages. (De Vita and Kyaw, 2013)

Another risk factor that needs mention is the rate of inflation at the tourist destination. If there is substantial inflation in the tourist spot, then all goods and services would be costly there which would discourage the tourists to visit those places. This would decline the demand for tour packages and drive down the price. (Agarwal, 2008).

Thus, the tour operators consider all risk factors that affect the demand and supply of the tourism industry for pricing strategy.

 

References

Agarwal, S. (2008). Now, inflation storm hits tourism industry. The Financial Express. [online] Available at: https://archive.financialexpress.com/news/Now-inflation-storm-hits-tourism-industry/347503/1 [Accessed 13 Feb. 2015].

Anon, (2015). [online] Available at: https://www.iba.gov.au/wp-content/uploads/2013/03/20130304ResearchReport_Demand-and-Supply-Issues-in-Indigenous-Tourism-A-Gap-Analysis.pdf [Accessed 13 Feb. 2015].

De Vita, G. (2014). The long-run impact of exchange rate regimes on international tourism flows.Tourism Management, 45, pp.226-233.

De Vita, G. and Kyaw, K. (2013). ROLE OF THE EXCHANGE RATE IN TOURISM DEMAND.Annals of Tourism Research, 43, pp.624-627.

Hall, C. (2010). Crisis events in tourism: subjects of crisis in tourism. Current Issues in Tourism, 13(5), pp.401-417.

https://www.tourism.umn.edu, (2012). Do families vacation more in the summer when school starts after Labor Day?. [online] Available at: https://www.tourism.umn.edu/prod/groups/cfans/@pub/@cfans/@tourism/documents/asset/cfans_asset_402396.pdf [Accessed 13 Feb. 2015].

Matias, A., Nijkamp, P. and Sarmento, M. (2013). Quantitative methods in tourism economics. Heidelberg: Physica-Verlag.

Turaev, B. (2010). The impact of organizational and economic factors on tourism development.Perspectives of Innovations, Economics and Business, pp.77-79.

Vanhove, N. (2011). The economics of tourism destinations. [Place of publication not identified]: Elsevier.

Yong, E. (2014). Innovation, Tourism Demand and Inflation: Evidence from 14 European Countries.JOEBM, pp.191-195.

Biggs, D. (2010). The Tourism Society's Dictionary for the Tourism Industry. Tourism Management, 31(4), p.556.

https://www.destinationnsw.com.au, (2015). Pricing your tourism product. [online] Available at: https://www.destinationnsw.com.au/wp-content/uploads/archived-items/Tourism-Business-Toolkit-VOL2-Chapter3.pdf [Accessed 13 Feb. 2015].

Spilsbury, R. (2011). Tourism industry. New York: Rosen Central.

Download Sample

Get 100% money back after download, simply upload your unique content* of similar no. of pages or more. We verify your content and once successfully verified 100% value credited to your wallet within 7 days.

Upload Unique Document

Document Under Evaluation

Get Credits into Your Wallet

*The content must not be available online or in our existing Database to qualify as unique.

Cite This Work

To export a reference to this article please select a referencing stye below:

My Assignment Help. (2016). Demand And Supply Of Tourism. Retrieved from https://myassignmenthelp.com/free-samples/demand-and-supply-of-tourism.

"Demand And Supply Of Tourism." My Assignment Help, 2016, https://myassignmenthelp.com/free-samples/demand-and-supply-of-tourism.

My Assignment Help (2016) Demand And Supply Of Tourism [Online]. Available from: https://myassignmenthelp.com/free-samples/demand-and-supply-of-tourism
[Accessed 10 July 2020].

My Assignment Help. 'Demand And Supply Of Tourism' (My Assignment Help, 2016) <https://myassignmenthelp.com/free-samples/demand-and-supply-of-tourism> accessed 10 July 2020.

My Assignment Help. Demand And Supply Of Tourism [Internet]. My Assignment Help. 2016 [cited 10 July 2020]. Available from: https://myassignmenthelp.com/free-samples/demand-and-supply-of-tourism.


For years, MyAssignmenthelp.com has been operating as one of the cheap assignment help providers in the USA. We are one of the best college paper writing services that keep service price minimal. We do not let the affordability of our service to hamper the standard of our work. We have separate teams of experts to provide report writing help . At MyAssigenmnthelp.com, we believe in earning credibility, so students can pay for assignments only after getting satisfied solutions. Tough assignments bother you? Trust us with your project. You will not regret paying us to write assignments for you.

Latest Management Samples

DMKT5008 Digital Marketing Spring

Download : 0 | Pages : 21

Answer: Introduction The whole study is focussed on the importance of digital marketing in nowadays. The importance is being felt by one of the renowned names in the entertainment industry. It is about HMV which is headquartered in the UK. The company had remained a popular name in the entertainment industry until the time; the position was actually being hampered by Amazon in around 2012. Amazon had enabled people getting their favourite mus...

Read More arrow

IHRM4032 Introduction To Human Resource Management Spring 2018

Download : 0 | Pages : 12

Answer: Introduction Management of human resources of an organization is pivotal to the success of the organization. Human resource management team plays a wide variety of roles in the business starting from recruiting competent employees, ensuring the employees are fairly compensated, putting efforts in retaining employees, managing organizational talent and addressing employee grievances (Jackson, Schuler & Jiang, 2014). The case in the...

Read More arrow Tags: Australia Marlborough Management University of New South Wales Humanities 

FELM4026 Financial And Economic Literacy For Managers11

Download : 0 | Pages : 20

Answer: Introduction: The financial and economic literacy report has been prepared to analyze and evaluate the numerous concepts about the economical concept, micro factors, macro factors etc. the report explains about the changes and the performance of UK economical position. For preparing the report, local high street market of UK has been evaluated and it has been identified that how the corporate could growth itself. Further, the study ha...

Read More arrow

FELM4026 Financial And Economic Literacy For Managers11

Download : 0 | Pages : 20

Answer: Introduction: The financial and economic literacy report has been prepared to analyze and evaluate the numerous concepts about the economical concept, micro factors, macro factors etc. the report explains about the changes and the performance of UK economical position. For preparing the report, local high street market of UK has been evaluated and it has been identified that how the corporate could growth itself. Further, the study ha...

Read More arrow

DMKT5008 Digital Marketing Spring 2018

Download : 0 | Pages : 21

Answer: Study background:   The whole study is focussed on the importance of digital marketing in nowadays. The importance is being felt by one of the renowned names in the entertainment industry. It is about HMV which is headquartered in the UK. The company had remained a popular name in the entertainment industry until the time; the position was actually being hampered by Amazon in around 2012. Amazon had enabled people getting th...

Read More arrow
Next
watch

Save Time & improve Grade

Just share Requriment and get customize Solution.

question
We will use e-mail only for:

arrow Communication regarding your orders

arrow To send you invoices, and other billing info

arrow To provide you with information of offers and other benefits

1,359,015

Orders

4.9/5

Overall Rating

5,081

Experts

Our Amazing Features

delivery

On Time Delivery

Our writers make sure that all orders are submitted, prior to the deadline.

work

Plagiarism Free Work

Using reliable plagiarism detection software, Turnitin.com.We only provide customized 100 percent original papers.

time

24 X 7 Live Help

Feel free to contact our assignment writing services any time via phone, email or live chat.

subject

Services For All Subjects

Our writers can provide you professional writing assistance on any subject at any level.

price

Best Price Guarantee

Our best price guarantee ensures that the features we offer cannot be matched by any of the competitors.

Our Experts

Assignment writing guide
student rating student rating student rating student rating student rating 4/5

1309 Order Completed

100% Response Time

Gemmie Chen

MSc in Nursing

Singapore, Singapore

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

2279 Order Completed

97% Response Time

Zachary Perez

PhD in Computer Science and Information System

Washington, United States

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

752 Order Completed

100% Response Time

Hugh Cleave

Masters in Human Resource Management (MMgt, HRM)

Wellington, New Zealand

Hire Me
Assignment writing guide
student rating student rating student rating student rating student rating 5/5

234 Order Completed

100% Response Time

Samantha Ji

PhD in Chemistry with Specialization in Organic

Singapore, Singapore

Hire Me

FREE Tools

plagiarism

Plagiarism Checker

Get all your documents checked for plagiarism or duplicacy with us.

essay

Essay Typer

Get different kinds of essays typed in minutes with clicks.

edit

GPA Calculator

Calculate your semester grades and cumulative GPa with our GPA Calculator.

referencing

Chemical Equation Balancer

Balance any chemical equation in minutes just by entering the formula.

calculator

Word Counter & Page Calculator

Calculate the number of words and number of pages of all your academic documents.

Refer Just 5 Friends to Earn More than $2000

Check your estimated earning as per your ability

1

1

1

Your Approx Earning

Live Review

Our Mission Client Satisfaction

he service is really good , and i got the good writer as well because it seems reliable. However, the price is so expensive than others

flag

User Id: 458240 - 10 Jul 2020

Australia

student rating student rating student rating student rating student rating

whenever i order essay they usually do a great job im really happy with the service provided

flag

User Id: 343054 - 10 Jul 2020

Australia

student rating student rating student rating student rating student rating

i got a really good grade on this essay it was perfect just what i needed im really happy with the work

flag

User Id: 343054 - 10 Jul 2020

Australia

student rating student rating student rating student rating student rating

thank you for the assignment work. I got a high B for the final grade. Excellent work

flag

User Id: 447983 - 10 Jul 2020

Australia

student rating student rating student rating student rating student rating
callback request mobile
Have any Query?