Southwest Airlines estimates the short-run price elasticity of business fares to be 2 and the long-run elasticity

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Southwest Airlines estimates the short-run price elasticity of business fares to be 2 and the long-run elasticity to be 5. Is ticket demand more elastic in the short-run or long-run? Does this seem reasonable? Explain.

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Managerial Economics and Organizational Architecture

ISBN: 978-0073375823

5th edition

Authors: James Brickley, Jerold Zimmerman, Clifford W. Smith Jr

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Question Posted: Apr 11, 2018 02:43 AM

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Southwest Airlines estimates the short-run price elasticity of business fares to be 2 and the long-run elasticity

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Fares are more elastic in the long run Suppose Southwest raises prices In the shortrun ...View the full answer

Managerial Economics and Organizational Architecture

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