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Matching demand and supply

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Online Travel Agencies (OTA) such as Expedia, Priceline, Opodo, and Orbitz make airline ticket price comparison fast and easy? Which of Porter's five forces is most applicable. Assess the effect of OTAs on airline industry competition, prices, and profitability.

One of the most challenging tasks for the airline manager is matching demand and supply (capacity). What characteristics of air travel demand make this so difficult in the short-run? In the long-run?

Airline passengers are broadly segmented by purpose of travel. Characterize the two major segments by price elasticity of demand. Use price elasticity of demand to explain how prices are set for each segment.

An airline loses money on one of its routes but has decided to continue to provide service. Could this decision be economically rational in the short-run? In the long-run?

Explain why the cost per available seat mile (CASM) is lower on large commercial aircraft, such as the B-787 or A-350, than on much smaller regional jets. Next, use the theory of supply and demand to why about half of all US domestic flights operated with regional jets with their higher CASM?

Reference no: EM131633547

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