Instructions:
Please, read the case below and respond to the situation/question below. This assignment should be around 500 words including only the answers. I have added Chapter 6 to use for text citation and concepts.
Professor’s instructions: Prior to your analysis, you should provide a
ief summary of the case, a paragraph or so in your own words with in text citations. You then can choose to answer the questions in paragraph form or type the question and then answer it. Either way is fine, but I do require that your answers have in text citations to support what you are saying. Some of the questions are your opinion, but you should also support that with concepts from the text.
Citation will be:
Brickley, J., Smith, C., & Zimmerman, J. (2016). Managerial economics and organizational architecture (6th ed.). New York: McGraw-Hill Education.
ANALYZING MANAGERIAL DECISIONS: United Airlines
The WSJ recently presented data suggesting that United Airlines was not covering its costs on flights from San Francisco to Washington D.C. The article quoted analysts saying that United should discontinue this service. The costs per flight (presented in the article) included the costs of fuel, pilots, flight attendants, food, etc. used on the flight. They also included a share of the costs associated with running the hubs at the two airports, such as ticket agents, building charges, baggage handlers, gate charges, etc. Suppose that the revenue collected on the typical United flight from San Francisco to Washington does not cover these costs. Does this fact imply that United should discontinue these flights? Explain.
Chapter 6: