Unit 4- The Tourism Industry in Canada

For exercise 4.3 I chose to talk about tourism in Canada. The article I chose is from the CBC news website, click here to read. The article was short and sweet but had all the appropriate information. The main point was that Canada's tourism rose 0.9 percent in the 4th quarter of 2011; this is up 9.5 percent since 2009. The fact that we recently got out of a recession is a strong indicator that tourism would increase because of the increase in income there is an increase in tourism.

To give you a better idea of what this increase looks like compared to other years and quarters I would also like to reference an additional article, click here, that included the same information found on the CBC website but also talked about how tourism spending in Canada has increased for the 10th consecutive quarter. The graph below found in this article shows us the pattern of tourism spending since 2002:

The condition of Canadian tourism is improving not just because of Canadians but also visitors from around the world; last year there was an increase of 0.8 percent in foreign visitors. As indicated in the article this occurred despite the value of dollar- which is still holding strong! When the value of money is high in another country it tends to ward off visitors from other countries because they are not getting the best value when they exchange their own currency for Canadian dollars.

Canadian tourism has a high degree of elasticity because when people have more disposable income they are more likely to travel and take part in tourist activities, whether it is in their home town or another city, province, or country.

Unit 4- Elasticity Revenue

The article I chose for this exercise is about the increase in tuition fees for universities in the UK. Click here to read the article on the BBC news website.
The information that is given in the article shows an increase in tuition fees from £3,350 to £9,000. As at January 15 there were 462,507 applicants for September up from 508,295. When looking at one country in particular to get a better idea of the effect that this is having, England alone had a decrease in applicants by 9.9%. (In order to plot the data I used an article published by The Guardian, found here, to show the original university fee of £3,350.)

Below you will find a graph plotting the tuition fees and number of applicants (I have used a combination of values found in my articles as well as values I added to help plot my points). The last values (£500, 200, 1.615385) were not included in the graph but were added to demonstrate the elasticity if the tuition fees dropped even lower and the number of applicants increase dramatically.



(Quantity is valued in thousands)

TR at 9,000 & 462,507= 4.2 million
TR at 3,350 & 508,295= 1.7 million

The maximum revenue is at approximately 400 applicants with the total revenue being approximately 5.2 million. Applicants increase when the price decreases but total revenue also decreases when the price decreases. Universities need to set their tuitions fees at a price that will still encourage applicants and will continue earning them a profit.