1: Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:Price Travelers Qds Vacationers Qds$150 2,100 tickets 1,000 tickets$200 2,000 800$250 1,900 600 $300 1,800 400a) As the price of tickets rises from $200 to $250, what is the price elasticity of demand for (i) business travelers and (ii) vacationers? (Use the Arc-Elasticity in your calculations.)b) Why might vacationers have a different elasticity from business travelers? Question 1: Suppose that business travelers and vacationers have the following demand for airline ticketsfrom New York to Boston:Quantity Demanded Quantity Demanded(business travelers)Price(vacationers)2,100 tickets2,0001,9001,800$1501,000 tickets200800250600300400a) As the price of tickets rises from $200 to $250, what is the price elasticity of demand for (i)business travelers and (ii) vacationers? (Use the Arc-Elasticity in your calculations.)b) Why might vacationers have a different elasticity from business travelers?

The price elasticity of demand is a measurement of how a product's consumption changes in response…

Answered: 1: Suppose that business travelers and…

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

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1: Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:

Price Travelers Qds Vacationers Qds
$150 2,100 tickets 1,000 tickets
$200 2,000 800
$250 1,900 600
$300 1,800 400

a) As the price of tickets rises from $200 to $250, what is the price elasticity of demand for (i) business travelers and (ii) vacationers? (Use the Arc-Elasticity in your calculations.)
b) Why might vacationers have a different elasticity from business travelers?

Question 1: Suppose that business travelers and vacationers have the following demand for airline tickets
from New York to Boston:
Quantity Demanded Quantity Demanded
(business travelers)
Price
(vacationers)
2,100 tickets
2,000
1,900
1,800
$150
1,000 tickets
200
800
250
600
300
400
a) As the price of tickets rises from $200 to $250, what is the price elasticity of demand for (i)
business travelers and (ii) vacationers? (Use the Arc-Elasticity in your calculations.)
b) Why might vacationers have a different elasticity from business travelers?

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