Question

A. Why may a hotel charge such very high prices for wine, soft drinks or even bottled water and yet quite reasonable prices for food and still get away with such high prices?

Answer 1

The justification given is indeed the performance, product as well as the location which makes up for the exorbitant cost charged.

Step-by-step explanation:

• It's indeed primarily although together with the goods, they have their service. The hotels wouldn't go out of operation even though they demand these high costs since perfect pairing some other considerations included within the amount, including the environment, infrastructure, facilities, services, etc.
• The income elasticity becomes extremely relatively elastic, which means the demand doesn't really exist based on the paid costs.