Should the airline remain in business

Assignment Help Business Economics

Reference no: EM13852124

Airway Express has an evening flight from Los Angeles to New York with an average of 80 passengers and a return flight the next afternoon with an average of 50 passengers. The plane makes no other trip. The charge for the plane remaining in New York overnight is $1200 and would be zero in Los Angeles. The airline is contemplating eliminating the night flight out of Los Angeles and replacing it with a morning flight. The estimated number of passengers is 70 in the morning flight and 50 in the return afternoon flight. The one-way ticket for any flight is $200.00. The operating cost of the plane for each flight is $11,000. The fixed costs for the plane are $3,000 per day whether it flies or not. A) Should the airline replace its night flight from Los Angeles with a morning flight? b) Should the airline remain in business?

Reference no: EM13852124

Questions Cloud

Should the facility make this investment : A proposed $2.5 million dollar investment at a 70 MGY (million gallons a year) facility will save the facility $800 k/ yr in energy costs. Assuming an interest rate of 5%/ yr, and equipment expected life of 10 years. Should the facility make this inv..

Supposed proposed public policy could result : Supposed a proposed public policy could result in three possible outcomes: If the probability of each outcome is, respectively, 0.85, 0.10, and 0.05, should the policy be pursued or not? Explain.

General shapes of cost curve graphs and firm supply graphs : In short-run, I see the question on slide 10 (Firm supply) used MC=SAVC to find the crossing point between MC and AVC, so does it mean that we can also take derivative of AVC with respect to Q and set it equal to zero to find minimum or maximum and t..

Types of compensation and benefits services : Assume you are a consultant who has been called in to present a client with a sample of best practices as they relate to the types of compensation and benefits services that you can assist the client with

Should the airline remain in business : Airway Express has an evening flight from Los Angeles to New York with an average of 80 passengers and a return flight the next afternoon with an average of 50 passengers. The fixed costs for the plane are $3,000 per day whether it flies or not. A) S..

Reflect a simulated clinical work environment : Could Mr Smith's culture influence his pain assessment? Why? What strategies could you employ to ensure that you are adequately addressing Mr Smith's pain - Reflect a simulated clinical work environment demonstrating critical thinking applied to cl..

Calculate the field : While a completely accurate answer would require some infinite series or extreme cleverness, just try to draw a rough map of where the field point over the square from the origin to (2,2) cm, with the understanding that each wire dominates its loc..

Coal power plant considers the costs of labor and materials : If a coal power plant considers the costs of labor and materials, as well as the broader costs of environmental injuries resulting from its power production processes then Its?

If firm experiences diseconomies of scope : If a firm experiences diseconomies of scope, then it:

User Account

All Pages