Back to Assignment Attempts I | Average / 1 2. Exercise 14.2 The price elasticity of demand for air travel differs radically from first-class (-1.3) to unrestricted coach (-1.4) to restricted discount coach (-1.8). Given these elasticities, what are the optimal prices (fares) on a cross-country trip with incremental variable costs (marginal costs) equal to $120? Hint: Remember that MR = P X (1+ %) Marginal Costs (MC) Price Elasticity of Demand Optimal Price 0355 ($) (ED) (P*) First-class $120 -1.3 Unrestricted Coach $120 -1.4 Restricted Discount $120 -1.8 Grade It Now Save & Continue Continue without saving