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Consider an airline's decision about whether to cancel a particular flight that hasn't sold out. The following table provides data on the total cost of operating a 100-seat plane for various numbers of passengers. Number of Passengers 10 30 40 50 90 100 Total Cost (Dollars per flight) 40,000 60,000 65,000 68,000 70,000 71,000 72,500 73,500 74,000 74,300 74,500 Given the information presented in the previous table, the fixed cost to operate this flight is S Price (Dollars per ticket) 1,000 700 400 200 At each ticket price, a different number of consumers will be willing to purchase tickets for this flight. Assume that the price of a flight is fixed for th duration of ticket sales. Use the previous table as well as the following demand schedule to complete the questions that follow. Quantity Demanded (Tickets per flight) 0 30 90 100

Consider an airline's decision about whether to cancel a particular flight that hasn't sold out. The following table provides data on the total cost of operating a 100-seat plane for various numbers of passengers. Number of Passengers 10 30 40 50 90 100 Total Cost (Dollars per flight) 40,000 60,000 65,000 68,000 70,000 71,000 72,500 73,500 74,000 74,300 74,500 Given the information presented in the previous table, the fixed cost to operate this flight is S Price (Dollars per ticket) 1,000 700 400 200 At each ticket price, a different number of consumers will be willing to purchase tickets for this flight. Assume that the price of a flight is fixed for th duration of ticket sales. Use the previous table as well as the following demand schedule to complete the questions that follow. Quantity Demanded (Tickets per flight) 0 30 90 100

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Complete the folowing table by computing total revenue, total cost, variable cost, and profit for each of the prices listed. (Hint: Be sure to enter a minus sign before the number if the numeric value of an entry is negative.) Price Total Revenue Total Cost Varlable Cost Profit (Dollars per ticket) (TR) (TC) (VC) (TR-TC) (Dollars) (Dollars) (Dollars) (Dollars) 1,000 40,000 -40,000 700 400 200 Given this information, the profit-maximizing price is per ticket, and seats out of 100 will be purchased. In this case, which of the following statements are true about the market at this price-quantity combination? Check all that apply. O Total revenue is greater than variable cost. O The airline is operating at too big a loss and should, therefore, cancel this flight. O Profit is positive. O Price is less than average total cost. If fixed cost increases to $57,500, does this change the production decision of the airline in the short run? O Yes O No True or False: Operating a flight without full capacity should never happen in the short run because it cannot be profitable. O True O False
Transcribed Image Text:Complete the folowing table by computing total revenue, total cost, variable cost, and profit for each of the prices listed. (Hint: Be sure to enter a minus sign before the number if the numeric value of an entry is negative.) Price Total Revenue Total Cost Varlable Cost Profit (Dollars per ticket) (TR) (TC) (VC) (TR-TC) (Dollars) (Dollars) (Dollars) (Dollars) 1,000 40,000 -40,000 700 400 200 Given this information, the profit-maximizing price is per ticket, and seats out of 100 will be purchased. In this case, which of the following statements are true about the market at this price-quantity combination? Check all that apply. O Total revenue is greater than variable cost. O The airline is operating at too big a loss and should, therefore, cancel this flight. O Profit is positive. O Price is less than average total cost. If fixed cost increases to $57,500, does this change the production decision of the airline in the short run? O Yes O No True or False: Operating a flight without full capacity should never happen in the short run because it cannot be profitable. O True O False
Consider an airline's decision about whether to cancel a particular flight that hasn't sold out. The following table provides data on the total cost of operating a 100-seat plane for various numbers of passengers. Total Cost Number of Passengers (Dollars per flight) 40,000 10 60,000 20 65,000 30 68,000 40 70,000 50 71,000 60 72,500 70 73,500 80 74,000 90 74,300 100 74,500 Given the information presented in the previous table, the fixed cost to operate this flight is s At each ticket price, a different number of consumers will be willing to purchase tickets for this flight. Assume that the price of a flight is fixed for the duration of ticket sales. Use the previous table as well as the following demand schedule to complete the questions that follow. Price Quantity Demanded (Dollars per ticket) (Tickets per flight) 1,000 700 30 400 90 200 100
Transcribed Image Text:Consider an airline's decision about whether to cancel a particular flight that hasn't sold out. The following table provides data on the total cost of operating a 100-seat plane for various numbers of passengers. Total Cost Number of Passengers (Dollars per flight) 40,000 10 60,000 20 65,000 30 68,000 40 70,000 50 71,000 60 72,500 70 73,500 80 74,000 90 74,300 100 74,500 Given the information presented in the previous table, the fixed cost to operate this flight is s At each ticket price, a different number of consumers will be willing to purchase tickets for this flight. Assume that the price of a flight is fixed for the duration of ticket sales. Use the previous table as well as the following demand schedule to complete the questions that follow. Price Quantity Demanded (Dollars per ticket) (Tickets per flight) 1,000 700 30 400 90 200 100
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