Business, 25.07.2020 03:01 haylee1468

Zero Turbulence Airline provides air transportation services between Los Angeles, California; and Kona, Hawaii. A single Los Angeles to Kona round-trip flight has the following operating statistics: Fuel $11,506
Flight crew salaries 8,813
Airplane depreciation 4,161
Variable cost per passenger—business class 45
Variable cost per passenger—economy class 35
Round-trip ticket price—business class 515
Round-trip ticket price—economy class 285

It is assumed that the fuel, crew salaries, and airplane depreciation are fixed, regardless of the number of seats sold for the round-trip flight. If required round the answers to nearest whole number.

Required:
a. Compute the break-even number of seats sold on a single round-trip flight for the overall product. Assume that the overall product is 10% business class and 90% economy class tickets.
b. How many business class and economy class seats would be sold at the break-even point?

Answers: 2

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Zero Turbulence Airline provides air transportation services between Los Angeles, California; and Ko...

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