Suppose the cost of flying (operating) a 300-seat plane from Washington D.C. to New York City for Delta airline is $35,000. The average price for each ticket sold is $200. There are 10 empty seats on a flight tonight. If the marginal cost of having one customer is $50, Delta airline should a.sell the last 10 seats at $40 per ticket to fill up the cabin. b.not sell the last 10 seats for anything lower than $200 per seat c.sell the last 10 seats for at least $50 per seat d.not sell any extra ticket for that flight because they have made enough money from that flight already

Airline will choose the alternative which would provide it the best possible profits . Profits =…

Answered: Suppose the cost of flying (operating)…

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter3: Benefits, Costs, And Decisions

Section: Chapter Questions

Problem 9MC

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Suppose the cost of flying (operating) a 300-seat plane from Washington D.C. to New York City for Delta airline is $35,000. The average price for each ticket sold is $200. There are 10 empty seats on a flight tonight. If the marginal cost of having one customer is $50, Delta airline should

	a.	sell the last 10 seats at $40 per ticket to fill up the cabin.
	b.	not sell the last 10 seats for anything lower than $200 per seat
	c.	sell the last 10 seats for at least $50 per seat
	d.	not sell any extra ticket for that flight because they have made enough money from that flight already

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