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An Airline Can Increase Its Profit by Offering Standby Customers

Question 111

Multiple Choice

An airline can increase its profit by offering standby customers an unsold seat at a substantial discount just before takeoff because


A) additional passengers are needed to balance the load.
B) the marginal cost of additional passengers is very small.
C) additional passengers add little to fixed costs.
D) such passengers add more to profits than do those with reserved seats.

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