Question

The market for air travel is characterized by a few major airlines that often engage in price wars and promotional offers to attract customers. However, during peak travel seasons or for specific routes with limited competition, airlines tend to raise prices significantly. Which of the following best explains the pricing behavior of airlines in this scenario?

A The demand for air travel is perfectly inelastic.
B Airlines operate in a perfectly competitive market.
C The supply of air travel is perfectly elastic.
D Airlines engage in price discrimination based on demand elasticity.
E The market for air travel is a monopoly.
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