Why are flights to the territories so expensive?

I live in the Yukon, and I certainly know about the prices up here! There are two big reasons: economies of scale, and, charging whatever they can.

Basically, there are hardly any people up here. The flights run, full, or empty. Costs are high - the airports (outside of Whitehorse) in the Yukon are gravel, and planes get dinged, and need more maintenance. Also, distances are far, and passengers are few, which contributes to the issues for making money. The other things is an acute lack of competition. I live near the Dawson Airport, and only 1 airline has regular flights here, Air North. So, they can charge whatever they like. They charge enough to make money, but, not so much as people stop taking them. Whitehorse is similar: Air North, and Air Canada use it, and some other tiny carriers, but, only those two use jets except in the summer, when Air Condor flies direct from Frankfurt Germany. Westjet tried getting in for the summer a few years ago, but, I am not sure they are still there. Air North, and Air Canada compete with each other for fights to/from Vancouver, but, that's about it. And, the largest planes anyone uses up here are 737's. Most aircraft are smaller - but, they still have to pay for much the same sorts of crews that larger planes have. So, higher costs for the airlines, and, no competition makes the prices higher.

It is the same reason we pay so much for the Internet up here - only one company to chose from, so, ....

Because the can be. Sure part of it is Economies of Scale. So low demand means fewer people want to fly there, and fewer people live there to begin with. This in tern means that the large cost of say, paying off a jet and airport is spread out over a lot fewer seats sold.

But don't let that let you think it works on its own. With that smaller demand makes it easier for Monopolies to force out smaller competition, price fixing among a few competitors and other forms of price gouging

The Queen, as head of Canada, has not given Royal Assent to stop such price gouging.

Depends where you are starting from

to Whitehorse.

From Ft Mac the fare starts at $171 one way

From Los Angeles $234 CDN.

Suggest you get some help looking for lower priced fares.

Iqualiuit is more could be lack of competition.

It's expensive to run and staff an airport there.

Low demand and great distance .

Flights to and from the US may be cheaper since some Canadian taxes aren't collected. Look into it if you have easy access to US airports.