With higher fuel costs, airlines raise their average fare from $0.50 to $1.50 per passenger kilometre and the number of passenger kilometres decreases from 2.5 million a day to 1.5 million a day. Over this price range, demand is
A)perfectly elastic.
B)perfectly inelastic.
C)unit elastic.
D)elastic, but not perfectly elastic.
E)inelastic, but not perfectly inelastic.

Question

Quizplus · Accepted Answer

The Answer of With higher fuel costs, airlines raise their average fare from $0.50 to $1.50 per passenger kilometre and the number of passenger kilometres decreases from 2.5 million a day to 1.5 million a day. Over this price range, demand is
A)perfectly elastic.
B)perfectly inelastic.
C)unit elastic.
D)elastic, but not perfectly elastic.
E)inelastic, but not perfectly inelastic.

With Higher Fuel Costs, Airlines Raise Their Average Fare from $0.50