In the mid-1990s,WestJet chose to compete head-on with Air Canada by launching WestJetLite,an alternative low-fare commercial airline passenger operation.Top executives at WestJet had expected its no-frills operation to break even within a year of its inception,but the airline fell short of the goal.A source close to the company explained it by saying,"Its costs were too high,and its revenues were too low." Some observers criticized WestJetLite's marketing efforts.When the no-frills service was first launched,it lacked a distinct name or identity,missing its chance to make a splash.Then WestJet tried to sell three "brands" at once-Plush ,a new premium service,and its more traditional long-haul domestic flights.As one rival expressed it,"You cannot be all things to all people."
-Refer to WestJetLite.The statement that WestJetLite had problems because,"Its costs were too high,and its revenues were too low," suggests which of the following?
A) The airline had no revenue left over after paying for airline activities.
B) The airline had no profit left over after paying for airline activities.
C) The airline had no returns left over after paying for airline activities.
D) The airline had no ROI left over after paying for airline activities.

Question

Quizplus · Accepted Answer

The statement suggests that the airline did not make any profit after paying for its activities. The costs were higher than the revenues earned, resulting in a shortfall.

In the Mid-1990s,WestJet Chose to Compete Head-On with Air Canada