Question 2 (1 point) Eagle airlines owns and operates 3 small twin engine airplanes in a small community in eastern United States. It offers both scheduled and charter flights. It is considering expanding its fleet with a used Piper Seneca that seats 5 passengers, offered for $95K. Eagle Airlines believes it can successfully counter at $85K to $90K. An investment alternative to the fourth plane would be a fixed income instrument paying 8%. Projected financial impact of the new aircraft is calculated as follows: Total Revenue = Revenue Charters + Revenue Schedule Flights = (%charter*Hours* Charter Price)+(1- %charter)*Hours *TicketPrice Passengers *Capacity FinanceCost = (Price*%financed *Rate) TotalCost = Hours *Operating Cost+Insurance+FinanceCost Profit = Total Revenue - TotalCost The spreadsheet below contains the Base Line values for the variables in the above calculations. Perform a two- way analysis on the variables Operating costs and Capacity of Scheduled Flights and write the equation in the field below. A B DE F Base Low High Hours Flown 800 500 1000 Capacity 50% 40% 60% Ticket Price $100 $95 $108 $325 $350 Charter Proportion 1 2 3 4 5 Charter Price $300 6 50% 45% 70% believes it can successfully counter at $85K to $90K. An investment alternative to the fourth plane would be a fixed income instrument paying 8%. Projected financial impact of the new aircraft is calculated as follows: Total Revenue = Revenue Charters + Revenue Schedule Flights = (%charter*Hours Charter Price)+(1- %charter)* Hours*TicketPrice* Passengers* Capacity Finance Cost = (Price*%financed*Rate) TotalCost = Hours* Operating Cost+Insurance+FinanceCost Profit = Total Revenue - TotalCost The spreadsheet below contains the Base Line values for the variables in the above calculations. Perform a two- way analysis on the variables Operating costs and Capacity of Scheduled Flights and write the equation in the field below. B C D E F Base Low High Hours Flown 800 500 1000 Capacity 50% 40% 60% Ticket Price $100 $95 $108 Charter Price $325 $300 $350 Charter Proportion 50% 45% 70% Operating Cost $245 $230 $260 Insurance $20,000 $18,000 $25,000 Aircraft Price $87.500 $85.000 $90,000 10 Interest Rate 11.5% 10.5% 11 Proportion Financed 40% 30% A 1 2 3 4 5 6 7 8 9 13.0% 50% Paragraph BIU Question 2 (1 point) Eagle airlines owns and operates 3 small twin engine airplanes in a small community in eastern United States. It offers both scheduled and charter flights. It is considering expanding its fleet with a used Piper Seneca that seats 5 passengers, offered for $95K. Eagle Airlines believes it can successfully counter at $85K to $90K. An investment alternative to the fourth plane would be a fixed income instrument paying 8%. Projected financial impact of the new aircraft is calculated as follows: Total Revenue = Revenue Charters + Revenue Schedule Flights = (%charter" Hours *Charter Price)+(1- %charter)"Hours TicketPrice"Passengers *Capacity Finance Cost = (Price*%financed"Rate) TotalCost - Hours OperatingCost+Insurance+FinanceCost Profit = Total Revenue - TotalCost The spreadsheet below contains the Base Line values for the variables in the above calculations. Perform a two- way analysis on the variables Operating costs and Capacity of Scheduled Flights and write the equation in the field below. B DE F 1 Base Low High 2 Hours Flown 800 500 3 Capacity 50% 40% 60% Ticket Price $100 $95 $108 Charter Price $325 $300 $350 6 Charter Proportion 1000 4 5 50% 45% 70% 7 Operating Cost 8 Insurance 9 Aircraft Price 10 Interest Rate 11 Proportion Financed $245 $20,000 $87.500 11.5% 40% $230 $18.000 $85.000 10.5% 30% $260 $25,000 $90,000 13.0% 50% Paragraph B - BIU Question 2 (1 point) Eagle airlines owns and operates 3 small twin engine airplanes in a small community in eastern United States. It offers both scheduled and charter flights. It is considering expanding its fleet with a used Piper Seneca that seats 5 passengers, offered for $95K. Eagle Airlines believes it can successfully counter at $85K to $90K. An investment alternative to the fourth plane would be a fixed income instrument paying 8%. Projected financial impact of the new aircraft is calculated as follows: Total Revenue = Revenue Charters + Revenue Schedule Flights = (%charter*Hours* Charter Price)+(1- %charter)*Hours *TicketPrice Passengers *Capacity FinanceCost = (Price*%financed *Rate) TotalCost = Hours *Operating Cost+Insurance+FinanceCost Profit = Total Revenue - TotalCost The spreadsheet below contains the Base Line values for the variables in the above calculations. Perform a two- way analysis on the variables Operating costs and Capacity of Scheduled Flights and write the equation in the field below. A B DE F Base Low High Hours Flown 800 500 1000 Capacity 50% 40% 60% Ticket Price $100 $95 $108 $325 $350 Charter Proportion 1 2 3 4 5 Charter Price $300 6 50% 45% 70% believes it can successfully counter at $85K to $90K. An investment alternative to the fourth plane would be a fixed income instrument paying 8%. Projected financial impact of the new aircraft is calculated as follows: Total Revenue = Revenue Charters + Revenue Schedule Flights = (%charter*Hours Charter Price)+(1- %charter)* Hours*TicketPrice* Passengers* Capacity Finance Cost = (Price*%financed*Rate) TotalCost = Hours* Operating Cost+Insurance+FinanceCost Profit = Total Revenue - TotalCost The spreadsheet below contains the Base Line values for the variables in the above calculations. Perform a two- way analysis on the variables Operating costs and Capacity of Scheduled Flights and write the equation in the field below. B C D E F Base Low High Hours Flown 800 500 1000 Capacity 50% 40% 60% Ticket Price $100 $95 $108 Charter Price $325 $300 $350 Charter Proportion 50% 45% 70% Operating Cost $245 $230 $260 Insurance $20,000 $18,000 $25,000 Aircraft Price $87.500 $85.000 $90,000 10 Interest Rate 11.5% 10.5% 11 Proportion Financed 40% 30% A 1 2 3 4 5 6 7 8 9 13.0% 50% Paragraph BIU Question 2 (1 point) Eagle airlines owns and operates 3 small twin engine airplanes in a small community in eastern United States. It offers both scheduled and charter flights. It is considering expanding its fleet with a used Piper Seneca that seats 5 passengers, offered for $95K. Eagle Airlines believes it can successfully counter at $85K to $90K. An investment alternative to the fourth plane would be a fixed income instrument paying 8%. Projected financial impact of the new aircraft is calculated as follows: Total Revenue = Revenue Charters + Revenue Schedule Flights = (%charter" Hours *Charter Price)+(1- %charter)"Hours TicketPrice"Passengers *Capacity Finance Cost = (Price*%financed"Rate) TotalCost - Hours OperatingCost+Insurance+FinanceCost Profit = Total Revenue - TotalCost The spreadsheet below contains the Base Line values for the variables in the above calculations. Perform a two- way analysis on the variables Operating costs and Capacity of Scheduled Flights and write the equation in the field below. B DE F 1 Base Low High 2 Hours Flown 800 500 3 Capacity 50% 40% 60% Ticket Price $100 $95 $108 Charter Price $325 $300 $350 6 Charter Proportion 1000 4 5 50% 45% 70% 7 Operating Cost 8 Insurance 9 Aircraft Price 10 Interest Rate 11 Proportion Financed $245 $20,000 $87.500 11.5% 40% $230 $18.000 $85.000 10.5% 30% $260 $25,000 $90,000 13.0% 50% Paragraph B - BIU