4 ms·
No one said there is a minimum volume that costs zero. There is a distribution of passengers requiring different amounts of space. The airline basically decided
by bitshiftfaced 2y ago
No one said there is a minimum volume that costs zero. There is a distribution of passengers requiring different amounts of space. The airline basically decided on some minimum that will be big enough to seat some percentile of passengers. (Presumably, the extreme right tail will have to buy two seats.) The airline doesn't sell a quarter of a seat or a half of a seat, so it doesn't make sense to compare seats in a way that assumes that this minimum portion of volume could cost a different amount for different passengers. It can't be broken up, so passengers always pay for all of it.
I'm saying that we should treat this minimum as a fixed cost. The airline could outfit the plane with all seats at this minimum volume to maximize seats. Then, the cost of a seat is the fixed cost for the minimum plus the cost of volume excess of this minimum. We should subtract the fixed cost and compare the excess volume per the remaining price.