Proposed model minus two price point-proposed model

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Reference no: EM131148921

Southeastern? Airlines's daily flight from Atlanta to Charlotte uses a Boeing? 737, with? all-coach seating for 120 people. In the? past, the airline has priced every seat at ?$142 for the?one-way flight. An average of 78 passengers are on each flight. The variable cost of a filled seat is $23. Katie? Morgan, the new operations? manager, has decided to try a yield revenue? approach, with seats priced at ?$83 for early bookings and at $195 for bookings within 1 week of the flight. She estimates that the airline will sell 66 seats at the lower price and 34 at the higher price. Variable cost will not change.

A) Total? $ contribution in the single price approach is ? ?(enter your response as a whole? number).

B) Total? $ contribution in the two price points approach is ? ?(enter your response as a whole? number).

Which approach is preferable to Ms.? Morgan?

A. Proposed model minus two price points Proposed model−two price points

B. Current model minus single priceCurrent model−single price.

Reference no: EM131148921

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