What Would an Economist Predict Would Happen If Airfares to Europe

question 167

Multiple Choice

What would an economist predict would happen if airfares to Europe were to increase?

• A) Airlines would make significantly greater profits.
• B) Most people would not change their travel and vacation plans.
• C) More individuals would choose to fly to Europe because now it is a more valuable experience.
• D) Many individuals would substitute toward other travel destinations.

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Definitions:

Marginal Revenue

Enhanced earnings from selling an additional unit of a product or service.

Prefabricated Garages

Structures for vehicle storage that are manufactured off-site in standard sections and then transported and assembled at the final location.

Total Revenue

The total amount of money a company receives from selling its goods or services, before any expenses are deducted.

Price Reduced

A decrease in the selling price of a product or service.