DescriptionThe output of this assignment is to be uploadedyou are encouraged to exercise creativity inpresenting your answers.Suppose that business travelers andvacationers have the following demand forairline tickets from New York to Boston:QuantityDemandedQuantityPriceDemanded(businetravelers)2,100 tickets2,0001,900(vacationers)$1501,000 tickets2008002506003001800400a. As the price of the ticket rises from $200 to$250, what is the price elasticity of demand for(1) business travelers(2) vacationers?b. explain why might vacationers have adifferent elasticity from business travelers?

a) (1) Price elasticity using midpoint method for Business travelers : Old price = $200, New price…

Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston: Quantity Demanded Quantity Demanded Price (business travelers) 2,100 tickets 2,000 (vacationers) $150 1,000 tickets 200 800 250 1,900 600 300 1800 400 a. As the price of the ticket rises from $200 to $250, what is the price elasticity of demand for (1) business travelers (2) vacationers? b. explain why might vacationers have a different elasticity from business travelers?

Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston: Quantity Demanded Quantity Demanded Price (business travelers) 2,100 tickets 2,000 (vacationers) $150 1,000 tickets 200 800 250 1,900 600 300 1800 400 a. As the price of the ticket rises from $200 to $250, what is the price elasticity of demand for (1) business travelers (2) vacationers? b. explain why might vacationers have a different elasticity from business travelers?

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter5: Elasticity

Section: Chapter Questions

Problem 28CTQ: Would you expect supply to play a more significant role in determining the price of a basic...

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