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Suppose There Are Four Buyers All Considering Purchasing Round-Trip Airfare

Question 5

Multiple Choice

Suppose there are four buyers all considering purchasing round-trip airfare from Boston to Miami with the following price elasticities of demand for this purchase: Buyer A: 1.5, Buyer B: 0.7, Buyer C: 1.0, Buyer D: 2.3. If the airline knows of these elasticities and practices price discrimination, which buyer will pay the highest price for the airfare?


A) Buyer A
B) Buyer B
C) Buyer C
D) Buyer D

Correct Answer:

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