The environmental impact of air travel per passenger trip is greater than that of other transport modes. The Australian federal government's National Energy Guarantee aimed to reduce greenhouse gas emissions to meet its Paris climate change commitments. It is suggested that a carbon tax can be imposed on all domestic air travellers, which means that when a passenger purchases a ticket, they need to pay a tax for his/her trip.

How would the carbon tax affect the demand for air travel?

Do you think the tax will significantly reduce the amount of air travel?

Use the demand and supply model and elasticity concepts to support your answer.