Scenario 14-5
An airline knows that there are two types of travelers: business travelers and vacationers.For a particular flight,there are 100 business travelers who will pay $600 for a ticket while there are 50 vacationers who will pay $300 for a ticket.There are 150 seats available on the plane.Suppose the cost to the airline of providing the flight is $20,000,which includes the cost of the pilots,flight attendants,fuel,etc.
-Refer to Scenario 14-5.How much profit will the airline earn if it sets the price of each ticket at $300?

Question

Quizplus · Accepted Answer

The airline will sell all 150 seats at $300 each, earning $45,000 in revenue. Subtracting the $20,000 cost, the profit is $25,000.

Scenario 14-5 An Airline Knows That There Are Two Types of Travelers