Why do the airlines charge less for passengers who stay over Saturday night and purchase their tickets two weeks in advance?
The airlines are practicing a form of price discrimination. They know the demand for leisure travel is much more elastic than the demand for business travel. Since leisure travelers plan in advance and usually have the option of staying over a Saturday night, they benefit from lower prices. Business travelers generally cannot choose either option. The airlines are attempting to maximize profit in each of these segmented markets. Leisure travelers gain both lower prices and more travel; business travelers pay more, but may gain from added flights due to the added leisure travel.
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In which of the following cases has political corruption definitely occurred?
A. Political candidates accept campaign contributions from people B. Government agencies impose fines for such things as traffic violations C. A bureaucrat allows someone to look at confidential documents for an informal fee D. A government agency receives donations for distribution to charity
Refer to the figure below. In response to gradually falling inflation, this economy will eventually move from its short-run equilibrium to its long-run equilibrium. Graphically, this would be seen as
A. long-run aggregate supply shifting leftward B. Short-run aggregate supply shifting downward C. Aggregate demand shifting rightward D. Aggregate demand shifting leftward