Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

Air New Zealand is negotiating with an aircraft leasing company over the lease contract for some additionalairplanes.The lease company is their only potential supplier of

Air New Zealand is negotiating with an aircraft leasing company over the lease contract for some additionalairplanes.The lease company is their only potential supplier of aircraft.Any airplanes that Air New Zealand does not want can be leased in the United States to small regional airlines, for about $2m per year.

Air New Zealand has a few routes on which it is considering using the aircraft:

  • Christchurch-Queenstown: one extra airplane would earnAirNZ an additional $4m profit per yearon that route, two extra airplanes would earn them $5m per year on that route (relative to current profits)
  • Wellington-Auckland: one extra airplane would earn them an additional$10m per year, two extra airplanes would earn $13m per year on that route (relative to current profits)
  • Wellington-Nelson: one extra airplane would earn them an additional $4m per year relative to current profits

1. How many airplanes does AirNZ lease? On which routes?

Group of answer choices

- Two, for use on the Auckland-Wellington route

- Four; two on the Christchurch-Queenstown route andtwo on the Auckland-Wellington route

- Four; one on the Christchurch-Queenstown route, two on the Auckland-Welllington route, and one on the Wellington-Nelson route.

- Five.

2. What is the negotiated (per year) payment to the lease company? Please enter a whole number with no dollar sign. (So if your answer is $9 million, enter 9000000.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Global Strategy

Authors: Mike W. Peng

5th Edition

9780357512364

Students also viewed these Economics questions