Thursday, November 09, 2006

Unit 1: Substitutes, Elasicity of Supply and the aircraft industry

This article tells us that Fedex has swiched its order from Airbus to Boeing.

a) What does it tell us about the cross elasticity of demand for the 777 and A380?
B0 Given the delays in delivering the A380, what can you say about the pelaticity of supply for the aircraft?
c) Why might this be the case?

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