In Recent Years, Airlines Have Been Subjected to Various Forms

question 32

Essay

In recent years, airlines have been subjected to various forms of criticism. An executive of Airline X has taken a quick poll of 16 regular airplane passengers. Each passenger is asked to rate the airline he or she last flew on. The ratings are on a 7-point Likert scale, where 1 = poor and 7 = very good. Of the 16 respondents, six last flew on Airline X and the remainder flew on other airlines. The ratings are shown below. Can the executive conclude from these data with 5% significance that Airline X is more highly rated than the other airlines? $$\begin{array} { | c | c | } \hline { \text { Ratings of Airlines } } \\\hline \text { Airline } \mathrm { X } & \text { Other Airlines } \\\hline 6 & 5 \\\hline 4 & 3 \\\hline 5 & 3 \\\hline 6 & 2 \\\hline 5 & 3 \\\hline 3 & 4 \\\hline & 3 \\\hline & 5 \\\hline & 3 \\\hline & 1 \\\hline\end{array}$$

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Definitions:

Labor Supply Curve

A graphical representation showcasing the relationship between the wage rate and the quantity of labor workers are willing to supply.

Competitive Firm

A company operating in a market where there are many buyers and sellers, and the firm has little influence over the price of its products.

Competitive Market

A market structure characterized by many buyers and sellers where no single entity can significantly influence prices or market outcomes.

Unions

Organizations formed by workers to protect their rights and interests, typically through collective bargaining with employers.