• To examine the impact of an EU-wide aviation tax on
short-haul markets, the elasticity would be developed
as follows:
- Base multiplier: -0.6 (supra-national)
- Geographic market: 1.4 (Intra Europe)
- Short-haul adjustor: 1.1
The price elasticity would then be calculated as:
-0.6 x 1.4 x 1.1 = -0.92