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weqwewe [10]
4 years ago
5

Suppose an airline determines that its customers traveling for business have inelastic demand and its customers traveling for va

cations have an elastic demand. If the airline's objective is to increase total revenue, it should A. decrease the price charged to vacationers and increase the price charged to business travelers. B. decrease the price to both groups of customers. C. increase the price charged to vacationers and decrease the price charged to business travelers. D. increase the price for both groups of customers.
Business
1 answer:
Ray Of Light [21]4 years ago
7 0

Answer: If the airline's objective is to increase total revenue, it should <u><em>decrease the price charged to vacationers and increase the price charged to business travelers.</em></u>

<u><em /></u>

Explanation:

Here the objective of the airline is to increase total revenue,  therefore airline should practice price discrimination i.e. charge different prices to vacation travelers and business travelers.

Since customers traveling for vacations have elastic demand i.e. ε > 1 , so if airline reduces the price of air ticket for them, then there will be a percentage decrease in the price that will be less then the percentage increase in the number of vacation travelers.

Therefore, total revenue will increase with decreasing price charged to vacationers.

Whereas;

The demand of business travelers is inelastic  i.e. ε < 1, so if airline increases the price of air ticket for business travelers, then there will be a percentage increase in the price that will be more then the percentage decrease in the number of vacation travelers

Therefore, total revenue will increase with increasing price charged to business travelers.

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Check the attached file for the answer.

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3 years ago
Which e-commerce business model used in procurement and sourcing has a seller-operated service that consists of a number of elec
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The correct answer is: electronic marketplace.

Explanation:

An electronic marketplace gathers sellers and suppliers through the worldwide web who offer their products virtually to fasten the purchase process and reach a larger number of consumers. These characters have a well-structured business even if it is not physical. Their objective is to give consumers to shop online without the need of going to the store in person.

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On January 1, Alan King decided to transfer an amount from his checking account into an investment account that later will provi
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Answer:

The requirement of the question is as below:

How much must Alan deposit on January 1? (Round your final answer to the nearest whole dollar amount.)  

What is the interest for the four years? (Round your final answer to the nearest whole dollar amount.)

Alan deposit on January 1 is $ 58,802.39  

Interest for four years is $21,197.61

Explanation:

The first is asking for today's worth of the investment,which is the amount to be invested,this can be computed using the present value as shown below:

PV=FV*(1+r)^-n

PV is the present value

FV is the worth of the investment in 4 years from now which is $80,000

r is the rate of return of 8%

n is the number of years of investment which is 4 years

PV=$80,000*(1+8%)^-4

PV=$80,0008(1+0.08)^-4

PV=$80,000*(1.08)^-4

PV =$ 58,802.39  

interest for four years=FV-PV

interest for four years=$80,000-$ 58,802.39  

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4 0
3 years ago
List the 6 factors that cause a shift in demand
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Answer:

1. Tastes and Preferences of the Consumers

2. Income of the People

3. Changes in Prices of the Related Goods

4. Advertisement Expenditure

5. The Number of Consumers in the Market

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Explanation:

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Answer: $3360

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Based on the information given in the question, the amount of cash paid by SH to Oakley will be calculated as thus:

SH will be entitled to a discount of 4% since the payment was made within the discount period, therefore, the discount that is applicable will be:

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