Arrive-And-Go Airline Wants to Clarify Its Baggage Handling Policy, Whilst

question 16

Multiple Choice

Arrive-and-Go airline wants to clarify its baggage handling policy, whilst maximizing revenues, and will introduce the following tariffs for all baggage per individual customer (weights are rounded up to the nearest 0.1Kg) : The first 2Kg will be carried free of charge. The next 10 Kg will be carried for a flat charge of 0. An additional 15Kg will be charged a total charge of 7. Luggage over this amount will be charged at $5 per Kg, up to a maximum of 150Kg per person. No passenger may take more that 150Kg with them. Which of the following would constitute boundary values for baggage weights in the price calculation?

• A) 0, 5.0, 10.0, 17.0
• B) 2.0,9.9, 15.0, 26.9
• C) 1.9, 12.0, 14.9, 150.0
• D) 2.0, 12.1, 27.0, 150.1

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Definitions:

Labor

The human effort, both physical and mental, used in the production of goods and services, a critical factor in determining productivity and economic output.

Output

Output refers to the total quantity of goods and services produced by an economy or business in a specific period.

Marginal Product

The supplementary yield achieved by the utilization of one additional unit of a variable factor, with all other resources remaining fixed.

Fixed Cost

Costs that do not vary with the level of production or sales, such as rent or salaries, over a relevant period.