To maximize profits,an airline will offer _____ prices to customers with _____ demand.
A)higher;inelastic
B)higher;elastic
C)lower;inelastic
D)the lowest;the least

Question

Quizplus · Accepted Answer

When demand is inelastic, customers are willing to pay a higher price for the same product or service, which means that the airline can charge higher prices and still sell a similar amount of tickets. This can lead to higher profits for the airline. On the other hand, if demand is elastic, customers will be more price sensitive and may choose a competitor offering a lower price, so the airline will need to lower its prices to maintain sales volume, which can lead to lower profits.

To Maximize Profits,an Airline Will Offer _____ Prices to Customers