Microeconomics 6th Edition by Robert Hall, Shirley Kuiper, Marc Lieberman

Exercise 9

Regarding Figure 1(b)in the chapter,one of your fellow students says,"I think the airline is making a mistake by charging students $70. It should drop the price further,so it could sell even more tickets than the 60 tickets in the figure. After all,as long as it charges even a little bit more than $40,its price will still be above its marginal cost,so it will still make a profit on each ticket." What is wrong with your fellow student's argument?
Figure 1