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An airline is flying between two cities. The airline has the following costs associated with the flight: Crew $4,000 Plane daily depreciation $2,000 Fuel 1,000
An airline is flying between two cities. The airline has the following costs associated with the flight: Crew $4,000 Plane daily depreciation $2,000 Fuel 1,000 Plane daily insurance 2,000 Landing fee 1,000 The airline has an average of 40 passengers paying an average of $200 for this flight. Do you think the airline should be flying between the two cities? Evaluate from a short-run and long-run perspective.
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