Price discrimination-economic profits

Reference no: EM1370546

Many airline routes worldwide are served by only one airline (a monopoly). Within the U.S., these are often from a small or mid-sized city to a major carrier hub and frequently operated by a regional carrier under contract to the larger airline.

Will these monopolies typically earn economic profits?

Why do not other airlines enter these monopoly routes?

Is price discrimination likely? If so, what type (1st, 2nd, or 3rd degree)? Will price discrimination increase profts?

Reference no: EM1370546

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