Contribution in the single price approach

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Reference no: EM131143301

Southeastern Airline’s daily flight from Atlanta to Charlotte uses a Boeing 737, with all-coach seating for 120 people. In the past, the airline has priced every seat at $141 for the one-way flight. An average of 82 passengers are on each flight. The variable cost of a filled seat is $25. Katie Morgan, the new operations manager, has decided to try a yield revenue approach, with seats priced at $77 for early bookings and at $192 for bookings within 1 wee of the flight. She estimates that the airline will sell 63 seats at the lower price and 34 at the higher price. Variable cost will not change.

Total $ contribution in the single price approach is $____ (enter your response as a whole number)

Total $ contribution in the two price points approach is $___ (enter your response as a whole number).

Reference no: EM131143301

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