3 ms·
The general principle here is that, everything else being equal, if the marginal revenue exceeds marginal cost (i.e. revenue is greater than variable costs), yo
by abtinf 8y ago
The general principle here is that, everything else being equal, if the marginal revenue exceeds marginal cost (i.e. revenue is greater than variable costs), you should make the sale. This is because you will lose less money than if you hadn’t made the sale.
Note however that airline pricing is notoriously difficult. There is no single price at which an airline may be flown profitably. It is an astounding achievement that the industry functions at all.