The President of a Major Airline Makes Telephone Calls to the Top

question 155

Multiple Choice

The president of a major airline makes telephone calls to the top executives of several other airlines asking them to "hold the line" and refrain from offering discounts on fares for several key routes in order to improve profit margins. This practice could easily be considered:

• A) Dumping.
• B) Price discrimination.
• C) Price fixing.
• D) Zone pricing.
• E) None of these is a good answer.

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Definitions:

Cash Invest

The process of committing money or capital to an endeavor with the expectation of obtaining an additional income or profit.

Semiannual Interest

Interest calculated or paid twice a year on loans, bonds, or savings accounts.

Bonds Dated

The date specified in the bond document when the bond was issued, important for determining interest payments and maturity.

Fair Value

An estimate of the price at which an asset would be bought or sold in a current transaction between willing parties, not under compulsion.