Visitors to Vail from Denver spend $1,000,000 each Labor Day Weekend, with 70% of that amount being spent in Vail itself (assume this 70% is the consumer expenditures made in the local area). Residents of Vail spend $100,000 on recreation in Vail that weekend as well. Visitors to Vail from New Mexico and Arizona spend $500,000, 70% of which is spent in Vail and 90% spent in Colorado (assume this 70% or 90% is the consumer expenditures made in the local area). The local and state value-added percentage is 30% of revenue. Businesses located in Vail make 40% of their purchases in Vail and an additional 25% of their purchases in the rest of the State of Colorado. For this exercise assume that consumers spend 95% of any additional income they receive.
Calculate the income multiplier and total income generated in Vail on Labor Day Weekend using Vail as the Impact Area.
