With the understanding of fixed and variable costs and what those mean to a business in both the short run and the long run, address the following questions in your analysis:

• Why does it make sense for an airline to offer discounted fares to students, senior citizens, or some other group, when those fares are lower than the average cost per passenger? Would it make sense to offer deeply discounted fares, such as a $59 ticket from Los Angeles to San Francisco, 1 hour before departure? Why?
• Does it make sense for a restaurant to offer early-bird specials and senior citizen discounts? Explain your answers in terms of the economic concepts of marginal revenue and marginal cost, as applicable.