The table below shows two demand schedules, 2002 and 2006, and one supply schedule.
5. 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) (vacationers)
150 2,100 tickets 1,000 tickets
200 2,000 800
250 1,900 600
300 1,800 400
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 midpoint method in your calculations.) Explain the difference.
Such a cheap price for your free time and healthy sleep
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