All categories

3 years ago

Why is there immitation in the airlines and how does this affect firm perfomance

1 answer:

5 0

2. Why is there a lot of imitation in the airlines industry, and how does this affect firm performance?There are a few reasons that airlines are subject to imitation. First, there are few supplierswithin the airline industry, partially because of the high costs involved with creating aircraft. With suppliers having such power, the supply side of aircraft is relatively set in stone for all airlines (Baumwoll et. al, 2008). This creates little room for differentiation. Second, with such heavy overhead costs, there are fewer options to do things differently and still make a profit. Yourwelcome:)

You might be interested in

One of the disadvantages of the perpetual inventory system is the company's decreased ability to keep better records with respec

suter [353]

True or false? You tell me cuz idk

8 0

3 years ago

You have won the NY State Lottery. The prize is $100,000,000, which is determined by 20 annual payments of $5,000,000. You can e

katen-ka-za [31]

Answer:

The annual payment have a better present value. It is $40,770,979 to $36,000,000.

After tax-basis we are $40,770,979 more richier

IRR for the prize 5.45%

Explanation:

we will use the NY state discount rate:

60,000,000 x (1- 40%) = 36,000,000 after-tax

second option:

5,000,000 x (1-40%) = 3,000,000 after-tax

we calculate the present value of a 20 year annuity for 5,000,000 dollars with a 4% discount rate.

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 3,000,000

time 20

rate 0.04

$3000000 \times \frac{1-(1+0.04)^{-20} }{0.04} = PV\\$

PV $40,770,979.0349

As this option is better than the upfront payment, it is better to take the annual payment.

We can determinate the real rate of return

We consider 60,000,000 upfront against 20 payment of 5,000,000 the rate will be calcualte with goal seek excel tool or trial and error manually:

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 5,000,000

time 20

PV $60,000,000.0000

$5000000 \times \frac{1-(1+r)^{-20} }{r} = PV\\$

rate = 0.05450114 = 5.45%

notice: that with this rate if we apply the tax rate we got the same rate:

$C \times \frac{1-(1+r)^{-time} }{rate} = PV\\$

C 3,000,000

time 20

PV $36,000,000.0000

$5000000 \times \frac{1-(1+r)^{-20} }{r} = PV\\$

rate = 0.05450114 = 5.45%

7 0

3 years ago

The model of monopolistic competition can characterize the market for plumbing services in a city. Suppose that the market is in

Verdich [7]

Answer:

Correct answer is (C) The price and output of plumbing services will rise

Explanation:

In a monopolistic market if the service or commodity is initially in long-run equilibrium, and then there is an increase in demand, then, there will increase in price in a short run as people demands more and the provider of the service or the producer of the goods will tend to provide or produce more.

6 0

4 years ago

You go to the movieplex where movies ordinarily cost $10. you are intending to see a movie for which you have a $3 off coupon go

Nata [24]

Well, you couldn't use the coupon because its only for that one specific movie you were gonna see and since its at the same time as the new release, you couldn't reuse the coupon. If you do go with your friend, Its $10 a person. If you're paying for both of you, it would be $20. If you are paying for yourself, its just $10. If your friend has a coupon like you had (but for the new release and same time) then it would be $17 total if you paid for both tickets. Hope this helps :)

6 0

4 years ago

A large corporation that runs nursing homes estimates that changes to Medicare will result in lower payments by Medicare to nurs

astra-53 [7]

Answer:

Should not

Explanation:

From the question, marginal cost exceeds the marginal benefit to be derived from the addition of beds.

Thus MC > MB

This means that it will cost the Corporation more to expand the number of beds than the benefits that they will derive from adding this feature. This shows that they are better off avoiding the addition of beds as this would make them to run at a loss. Hence, they should not offer additional beds.

3 0

4 years ago