Multiple Choice
If the price elasticity of demand for airline tickets is 3.0 for a vacation traveler and 0.4 for a business traveler, then a monopolist interested in price discrimination would charge
A) a higher price for the business traveler and a lower price for the vacation traveler.
B) a lower price for the business traveler and a higher price for the vacation traveler.
C) the same price for the vacation traveler and the business traveler.
D) a less profitable price for the business traveler than for the vacation traveler.
Correct Answer:
Verified
Correct Answer:
Verified
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