Airlines charge a ____________ to business travelers compared to leisure travelers because business travelers have a ____________ demand than leisure travelers.

Question

Quizplus · Accepted Answer

Airlines charge a higher fare to business travelers because their demand is less elastic compared to leisure travelers. Business travelers usually have more urgent and time-sensitive travel needs, and are therefore less likely to be deterred by price increases. Leisure travelers, on the other hand, often have more flexibility in their travel plans and are more price sensitive, making their demand more elastic.

Airlines Charge a ____________ to Business Travelers Compared to Leisure