Which of the Following Best Explains Why Airlines Often Cut

question 158

Multiple Choice

Which of the following best explains why airlines often cut their ticket prices at the last-minute in order to fill the remaining empty seats on their flights?

• A)Fixed costs in the airline industry are very large, but the marginal cost of flying one more passenger is very low.
• B)Airlines receive a subsidy from the government for each flight that is fully booked and departs on time.
• C)The Federal Aviation Administration ranks each airline based on the percentage of flights that are fully booked. These rankings affect the decisions of firms to use a particular airline to fly their employees to business meetings.
• D)Cutting prices makes the airlines more popular with their customers, who may fly with the same airline in the future as the result of buying low-price tickets.

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Definitions:

Hearing

The physiological process and perception of sound by the ears and brain, including the ability to perceive and interpret auditory information.

Melanoma

A type of skin cancer that develops from the pigment-producing melanocytes, often characterized by the uncontrolled growth of pigment cells.

Anterior Skin

The front surface of the skin, particularly referring to the aspect that faces forward or is most visible in standard anatomical position.

Posterior Skin

The skin located on the back side of the body, covering areas from the back of the head to the heels.