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Southeastern Airlines's daily flight from Atlanta to Charlotte uses a Boeing 737, with all-coach seating for 120 people. In the past, the airline has priced
Southeastern Airlines's daily flight from Atlanta to Charlotte uses a Boeing 737, with all-coach seating for 120 people. In the past, the airline has priced every seat at $136 for the one-way flight. An average of 81 passengers are on each flight. The variable cost of a filled seat is $23. Aysajan Eziz, the new operations manager, has decided to try a yield revenue approach, with seats priced at $82 for early bookings and at $195 or bookings within 1 week of the flight. He estimates that the airline will sell 66 seats at the lower price and 33 at the higher price. Variable cost will not change. 1. Total S contribution in the single price approach is ? (enter your response as a whole number). 2. Total contribution in the two price points approach is ? (enter your response as a whole number). 3.Which approach is preferable to Mr. Eziz? A.Proposed model-two price points OR B. Current Model - Single price
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