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# Several airlines have recently intensified their fierce

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Several airlines have recently intensified their fierce [#permalink]

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28 Sep 2004, 20:24
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Several airlines have recently intensified their fierce competition for business by offering tickets that, if purchased 2 days in advance, cost as much as 40 percent less than the heretofore lowest-priced "super-saver" tickets, which require a 30-day advance purchase. The airlines' long-term gains from tickets bought under this new plan will be enormous because, unlike earlier discount tickets, these are not refundable.

The author assumes which of the following about discounted airline tickets in predicting long-term gains in airline revenue?
A) More discounted, advance purchase tickets are purchased than are actually used
B) Tickets requiring 30-day advance purchase are not profitable for airlines
D) Airlines will have to discontinue offering 30-day advance purchase tickets when they begin offering 2-day advance purchase tickets
E) The majority of the 2-day advance purchase tickets offered by a given airline will be sold to passengers who have not previously flown on that airline
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Paul

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Director
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28 Sep 2004, 21:04
A clearly.

Less people use advanced tickets. Best case would be that the same seat is sold to someone else -meaning they make more money per sale in some of the tickets. Worst case, they have still sold a seat anyway whether used or unsused.

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Director
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28 Sep 2004, 21:26
A.

Author assumes that the airlines 30-day-program is not so effective since people, with no-so-concrete travel plans, buy and return tickets often. The new plan, since people cannot return tickets, would serve the purpose.

D cannot be true, since both plans can stay together. Advance-40% discount tickets returned can be sold in the new-2day-plan. It would give the airlies some profit, rather than not having sold that.

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29 Sep 2004, 00:39
A and E are very close contenders.
Will choose A

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29 Sep 2004, 20:36
OA is A
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Paul

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03 Oct 2004, 02:50
i was leaning on E.
More purchased verus usage could be the case for other ticket categories as well...and then the question of refunds being possible as well...
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Franky
http://franky4gmat.blogspot.com

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03 Oct 2004, 02:50
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# Several airlines have recently intensified their fierce

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