Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:
Price
Quantity Demanded by Business Travelers
Quantity Demanded by Vacationers
(Dollars)
(Tickets)
(Tickets)
150
2,100
1,000
200
2,000
800
250
1,900
600
300
1,800
400
As the price of tickets rises from $250 to $300, the price elasticity of demand for business travelers is __________ (0.30, 0.45, 2.20, 1), and the price elasticity of demand for vacationers is __________ (0.30, 0.45, 2.20, 1), using the midpoint method. Therefore, the demand for airline tickets in this price range is __________ (more , less) elastic for vacationers because business travelers are ___________ (less, more) sensitive to changes in price.