Airlines overfill customers beyond their seating capacity in order to compensate for customers who cancel their booking.This technique is an illustration of which of the following yield management strategies?
A)overbooking
B)adjusting prices to augment demand
C)annualized hours strategy
D)using different fare classes to partition demand

Question

Quizplus · Accepted Answer

Overbooking is the yield management strategy of intentionally selling more seats than the available capacity to compensate for cancellations and no-shows. This helps airlines maximize their revenue and minimize losses due to empty seats.

Airlines Overfill Customers Beyond Their Seating Capacity in Order to Compensate