Question
Southeastern Airlines's daily flight from Atlanta to Charlotte uses a Boeing 737, with all-coach seating for people. In the past, the airline has priced every
Southeastern Airlines's daily flight from Atlanta to Charlotte uses a Boeing 737, with all-coach seating for people. In the past, the airline has priced every seat at $ for the one-way flight. An average of passengers are on each flight. The variable cost of a filled seat is $. Aysajan Eziz, the new operations manager, has decided to try a yield revenue approach, with seats priced at $ for early bookings and at $ for bookings within 1 week of the flight. He estimates that the airline will sell seats at the lower price and at the higher price. Variable cost will not change. A) Total $ contribution in the single price approach is ?(enter your response as a whole number). B) Total $ contribution in the two price points approach is ? (enter your response as a wholenumber). CWhich approach is preferable to Ms. Morgan? A. Proposed model minus two price points B. Current model minus single price
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 $140 for the one-way flight. An average of 80 passengers are on each flight. The variable cost of a filled seat is $25. Aysajan Eziz, the new operations manager, has decided to try a yield revenue approach, with seats priced at $80 for early bookings and at $190 for bookings within 1 week of the flight. He estimates that the airline will sell 65 seats at the lower price and 35 at the higher price. Variable cost will not change. Total \$ contribution in the single price approach is $ (enter your response as a whole number). Total \$ contribution in the two price points approach is \$ (enter your response as a whole number)Step by Step Solution
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