Suppose that business travellers and leisure travellers have the demand schedules for airline tickets from Atlanta to Philadelphia given in the table above.

Price Quantity demanded business Quantity demanded leisure (dollars per ticket) travellers travellers (tickets per week) (tickets per week) 0 1,800 1,600 100 1,600 1,200 200 1,400 800 300 1,200 400 400 1,000 0 500 800 0 2) Suppose that business travellers and leisure travellers have the demand schedules for airline tickets from Atlanta to Philadelphia given in the table above. a Draw both demand curves. (10m) b) As the price of tickets rises from $200 to $300, what is the price elasticity of business travellers' demand? What is the price elasticity of leisure traveller's demand? (Use the midpoint method in your calculations.) (15m) c) Why do business travellers and leisure travellers have different price elasticities of demand for airline tickets? (15m) d) At what price is the price elasticity of demand equal to 1 for business travellers? For leisure travellers? Explain. (10m) [Total = 50 marks] Page 2 of 3