Coconut Airways is suffering from low revenues and inadequate profits. The managing director reports the following facts about the company's performance for the month.
Average fare: $100
Number of passengers: 2000
Price elasticity: -1.5
The company is proposing a fare increase to $110. Should the company go ahead with the increase? Explain.
1
Expert's answer
2014-05-23T13:39:48-0400
Average fare: $100, number of passengers: 2000, Price elasticity: -1.5. The company is proposing a fare increase to $110. As the price elasticity is -1.5, demand is elastic, so the increase in price will tend to decrease in total revenue, so the company shouldn't go ahead with the increase
Numbers and figures are an essential part of our world, necessary for almost everything we do every day. As important…
APPROVED BY CLIENTS
Finding a professional expert in "partial differential equations" in the advanced level is difficult.
You can find this expert in "Assignmentexpert.com" with confidence.
Exceptional experts! I appreciate your help. God bless you!
Comments
Leave a comment