..... 5. Law of DemandSuppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:Quantity Demanded by Business Travelers(Tickets)PriceQuantity Demanded by Vacationers(Dollars)(Tickets)1502,1001,0002002,0008002501,9006003001,800400As the price of tickets rises from $250 to $300, the price elasticity of demand for business travelers isand the price elasticity of demand forvacationers is, using the midpoint method. Therefore, the demand for airline tickets in this price range isv elastic for vacationersbecause business travelers aresensitive to changes in price.

The price elasticity of demand is the rate change in the demanded quantity divided by the rate…

of Demand Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston: Price Quantity Demanded by Business Travelers Quantity Demanded by Vacationers (Dollars) (Tickets) (Tickets) 1.000 150 2.100 200 2.000 800 250 1,900 600 300 1,800 400

of Demand Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston: Price Quantity Demanded by Business Travelers Quantity Demanded by Vacationers (Dollars) (Tickets) (Tickets) 1.000 150 2.100 200 2.000 800 250 1,900 600 300 1,800 400

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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