Education and Career Forum

please send the cited subject solved mega mcqs managerial economic

. The Internet has drastically reduced the cost of intermediary services of travel
agencies, real-estate brokers, and investment advisors. Consider the market for air
travel. Suppose that, with booking through travel agencies, the market equilibrium
price is $500 per ticket, including a $25 cost of intermediation. The quantity bought
is two million tickets a year. With Internet bookings, however, the intermediation
cost falls to $2 per ticket.
(a) Using suitable demand and supply curves, illustrate the original equilibrium
with booking through travel agencies. Represent the intermediation cost by
shifting the supply curve.
(b) Illustrate the new equilibrium with online booking.
(c) Under what conditions of demand and supply would consumers benefit more
(i.e. lower price) from online bookings? (Hint: elasticity)
4. Following a collapse of sales in the wake of the sub-prime financial crisis,