A regional airline sells 200 tickets to New York City for an average price of $200 one way. Half of the people on the flight will purchase a meal for $5. The airline's employee costs per flight include $500 each for the pilot and copilot, and $200 for each flight attendant. The law requires airlines to have at least one pilot, copilot, and flight attendant for each flight. Fuel for the flight is expected to cost $10000, and the cost of catering food is $1 for each item purchased. Show Transcribed Text The airline earns $ in revenue from tickets and $ from in-flight purchases. in fixed costs. profit. If one flight attendant is staffed for the flight, the airline pays $ If the airline has three flight attendants for the flight, the firm earns $ Show Transcribed Text What happens to profit in each of the following scenarios, given the information in Part 1 above? Scenario 1. An unexpected fuel shortage results in an increase in the price of fuel for the foreseeable future. 2. A large conference is announced in New York, which results in an increase in demand for seats on flights to New York. 3. A competing airline opens a route, which increases the supply of flights to New York City. 4. The pilots' union negotiates higher wages for pilots and copilots. Change in Profit stays the same increases decreases
A regional airline sells 200 tickets to New York City for an average price of $200 one way. Half of the people on the flight will purchase a meal for $5. The airline's employee costs per flight include $500 each for the pilot and copilot, and $200 for each flight attendant. The law requires airlines to have at least one pilot, copilot, and flight attendant for each flight. Fuel for the flight is expected to cost $10000, and the cost of catering food is $1 for each item purchased. Show Transcribed Text The airline earns $ in revenue from tickets and $ from in-flight purchases. in fixed costs. profit. If one flight attendant is staffed for the flight, the airline pays $ If the airline has three flight attendants for the flight, the firm earns $ Show Transcribed Text What happens to profit in each of the following scenarios, given the information in Part 1 above? Scenario 1. An unexpected fuel shortage results in an increase in the price of fuel for the foreseeable future. 2. A large conference is announced in New York, which results in an increase in demand for seats on flights to New York. 3. A competing airline opens a route, which increases the supply of flights to New York City. 4. The pilots' union negotiates higher wages for pilots and copilots. Change in Profit stays the same increases decreases
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:A regional airline sells 200 tickets to New York City for an average price of $200 one way. Half of the people on the flight will purchase a meal for $5.
The airline's employee costs per flight include $500 each for the pilot and copilot, and $200 for each flight attendant. The law requires airlines to have
at least one pilot, copilot, and flight attendant for each flight. Fuel for the flight is expected to cost $10000, and the cost of catering food is $1 for each
item purchased.
Show Transcribed Text
The airline earns $
in revenue from tickets and $
from in-flight purchases.
in fixed costs.
profit.
If one flight attendant is staffed for the flight, the airline pays $
If the airline has three flight attendants for the flight, the firm earns $
Show Transcribed Text
What happens to profit in each of the following scenarios, given the information in Part 1 above?
Scenario
1. An unexpected fuel shortage results in an increase in the price of fuel for the
foreseeable future.
2. A large conference is announced in New York, which results in an increase in
demand for seats on flights to New York.
3. A competing airline opens a route, which increases the supply of flights to New York
City.
4. The pilots' union negotiates higher wages for pilots and copilots.
Change in Profit
stays the same
increases
decreases
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