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

question 80

Multiple Choice

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.WestJetLite's pricing objectives were based on gaining as much market share as possible from Air Canada.This suggests that WestJetLite had what type of pricing objectives?

Definitions:

Penalty

A sum inserted into a contract not as a measure of compensation for its breach but rather as punishment for a default. The agreement as to the amount will not be enforced, and recovery will be limited to actual damages.

Lien

A legal right or claim against a property by a creditor to secure the payment of a debt or obligation.

Borrower

An individual or organization that receives funds from another party under the condition of returning it over time with interest.

Debt

Money owed by one party to another under the agreement that it will be repaid.