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) 150 2,100 1,000 200 2,000 800 250 1,900 600 300 1,800 400   As the price of tickets rises from $200 to $250, the price elasticity of demand for business travelers is    , and the price elasticity of demand for vacationers is    , using the midpoint method. Therefore, the demand for airline tickets in this price range is    elastic for vacationers because business travelers are    sensitive to changes in price.

Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter7: Consumer Choice And Elasticity
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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)
150 2,100 1,000
200 2,000 800
250 1,900 600
300 1,800 400
 
As the price of tickets rises from $200 to $250, the price elasticity of demand for business travelers is    , and the price elasticity of demand for vacationers is    , using the midpoint method. Therefore, the demand for airline tickets in this price range is    elastic for vacationers because business travelers are    sensitive to changes in price.
 
 

 

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