. Airlines often engage in last-minute price cutting to fill remaining empty seats on a flight because this practice will generally _____. a. prevent rival airlines from competing in that market b. increase marginal revenue more than marginal cost c. maximize marginal revenue d. discourage rivals from matching price cuts
Added by Ashley B.
Step 1
The question is about airlines engaging in last-minute price cutting to fill remaining empty seats on a flight. This practice is a common strategy used by airlines to ensure that as many seats as possible are filled, even if it means reducing the price of those Show more…
Show all steps
Your feedback will help us improve your experience
Anjali Kurse and 99 other Microeconomics educators are ready to help you.
Ask a new question
Labs
Want to see this concept in action?
Explore this concept interactively to see how it behaves as you change inputs.
Key Concepts
Recommended Videos
Suppose the cost of flying a 200-seat plane for an airline is $100,000 and there are 10 empty seats on a flight. If the marginal cost of flying a passenger is $200 and a standby passenger is willing to pay $300, the airline should...a. sell the ticket because the marginal benefit exceeds the marginal cost. b. sell the ticket because the marginal benefit exceeds the average cost. c. not sell the ticket because the marginal benefit is less than the marginal cost. d. not sell the ticket because the marginal benefit is less than the average cost.
Anjali K.
Take a scenario where a profit-maximizing company is in a perfectly competitive industry. When marginal costs are falling, what should it do? a. Maintain its output levels on the downward-sloping portion of the marginal cost curve. b. Reduce prices. c. Reduce its output. d. Raise output until marginal costs are equal to marginal revenue.
Brooke B.
If the marginal cost exceeds marginal revenue, a profit-maximizing monopolist will A) attempt to maintain this position because it is consistent with profit maximization B) raise the price and expand output to increase profit C) restrict output to increase the price even higher D) lower price and expand output to increase profit
Lottie A.
Recommended Textbooks
Principles of Economics
Principles of Microeconomics for AP® Courses
Economics
Transcript
18,000,000+
Students on Numerade
Trusted by students at 8,000+ universities
Watch the video solution with this free unlock.
EMAIL
PASSWORD