Subway fare increase on quantity of subway trips demanded

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To travel around Gotham City, some people take the subway and others ride buses. Still others use the Batmobile. Suppose the PED for subway trips by Gothamites is 1.5, the income elasticity of demand for subway trips is 0.5, and the cross PED for subway trips with respect to the price of bus trips is 0.6. Subway fares rise by 10%. How much will bus fares have to rise to offset the effect of the subway fare increase on the quantity of subway trips demanded?

Reference no: EM131424715

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