a.As the price of tickets rises from $200 to $250, what is the price elasticity of demand for (i)Business Travelers and (ii) Vacationers? (Use Arc method in your calculations). Explain with the help of diagrams.(12 marks)

b.Why might vacationers have different elasticity from business travelers? (3 marks)

c.Explain the factors which influence the demand for air line ticket. (5 marks)

Suppose the business travelers and vacationers have following demand for airline tickets from New York to Boston. Price Quantitj,r demanded Quantity demanded (Business Travelers) (Vacationers) $150 2100 tickets 1000 tickets 200 2000 300 250 1900 500 300 1800 400