Federal transportation administration has introduced a new


Federal Transportation Administration has introduced a new tax on train travel. There are two types of travelers by train, business travelers and leisure travelers. The former have a price elasticity of demand of -1.2; the latter have a price elasticity of demand of -3. Which type of traveler will bear the larger burden of the tax? Briefly explain your reasoning.

Solution Preview :

Prepared by a verified Expert
Basic Computer Science: Federal transportation administration has introduced a new
Reference No:- TGS02816896

Now Priced at $10 (50% Discount)

Recommended (94%)

Rated (4.6/5)