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Economics

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1.Suppose that business travellers and vacationers have the following demand (Qd) for airline tickets from Penang to Singapore. Price Qd-Vacation Qd-Business Travel Travel RM150 2100 1000 RM200 2000 800 RM250 1900 600 RM300 1800 400 a) As the price of tickets rises from RM250 to RM300, what is the price elasticity of demand for: i. Business travel (7 marks) Vacationers (7 marks) b) Why might vacationers have different elasticity than business travellers?

2.What are the poor laws and why does Ricardo feel their effect is "pernicious." in The Iron Law of Wages