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A new errant, Bargain Airways, cuts air fares between Eastwich and Westwich by 20 percent. Biggie Airlines, which has been operating on this route, responds

A new errant, Bargain Airways, cuts air fares between Eastwich and Westwich by 20 percent. Biggie Airlines, which has been operating on this route, responds by cutting fares by 35 percent. What does Biggie hope to achieve? If air transportation were perfectly contestable, why would Biggie Airlines ( see discussion question 6) fail to achieve the ultimate goal of its price cut?

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