CASE STUDY: The price elasticity of air travel demand varies according to the coverage and location of the market in which prices are changed and the importance of the air travel price within the overall cost of travel.

The estimate for the price elasticity of demand for a particular route was found to be −1.4 on average, whereas the price elasticity of demand for flights from any airport in one country to another were −0.8.

Air travel price elasticities on short-haul routes were higher than on long-haul routes. This largely reflects the greater opportunity for substitution on short-haul routes (e. g. travelers can switch to rail or car in response to air travel price

Q1.Explain why demand for short-haul flights was more price elastic than demand for long-haul flights.(6)
Q2.Discuss the significance of the findings above for the pricing of fights on a particular route.(10)

If we know that a firm has a net profit margin of 4.6 %, total asset turnover of 0.62, and a financial leverage multiplier of 1.54, what is its roe? what is the advantage to using the dupont system to calculate roe over the direct calculation of earnings available for common stockholders divided by common stock equity?

Intronix uses copy editors, computer graphics specialists, and java programmers to produce ads for magazines and the internet. the average new ad for magazines typically requires 180 hours of a copy editor's time and 135 hours of a computer graphics specialist's time, whereas ads produced for the internet require 35 hours of copy editor time, 195 hours of computer graphics time, and 60 hours of a java programmer's time. lassie food, a dog food manufacturer, has hired intronix to produce ads in the next four week. although currently it considers magazine ads 3 times more valuable than internet ads, it still wishes to have at least 2 of each produced within the next four weeks. intronix has assigned up to 3 copy editors, 4 computer graphics specialists, and 1 java programmer, each committed to work up to 70 hours per week on the project. how many of each type of ad should be produced to maximize the overall value to lassie foods

For the past six years, the price of slippery rock stock has been increasing at a rate of 8.21 percent a year. currently, the stock is priced at $43.40 a share and has a required return of 11.65 percent. what is the dividend yield? 3.20 percent 2.75 percent 3.69 percent