Market Economy
Explain the statement "Hypothes is the basic short run and long run behaviors of the airline industry in a market economy".
Expert
Short run is the period where a fixed factor of production remains constant. The output or service can go high in small measures only. Entrepreneur cannot alter the fixed factors of production to his advantage. Investment and manpower cannot get increase in short period of time. Both business conditions and environment hamper business man to aim for greater production or service level. The average cost will be at competitive level with small output and given set of production factors. Hence any decision a business man takes in the short run will give only small increase in output or service at a given price. Airline business can also face similar situation where it cannot increase the service in short run. The tendency of the airline business in the short run is not to disturb the current level price as it can give only limited service without any expansion. Very often, in the short run, the business can operate only in short routes and destinations. It cannot increase the fleet of operations and cannot fly to longer destinations.
Long run decision and long run period denotes the situation where a business man can conveniently alter the factors of production to his advantage. Capital budgeting decisions are possible only in the long run. Airline business firm can increase the fleet of operation and travel destinations only in the long run. Passengers can get lot of benefit in the long run period. Price concessions and cost reduction will be possible in the long run. Passenger traffic and passenger amenities will be possible only in long run period. Innovation and novelty will be the unique feature in the long run situation. Sustainable development in the airline business is possible with the support of government policy. Government can also help both private and state airliners in the subsidies and financial assistance. It is hypothesized that airlines charge passenger fees direct to their customers. Protection of competition is essential to secure sustainable development.
In the figure shown below, line T1 depicts a tax system which is: (1) Regressive. (2) Progressive. (3) Proportional. (4) Unbiased. (5) Recessive.
Question: This assignment in Economics, deals with macro-economics. An essay on Market imperfection associated with negative externalities. According to Economics, perfect markets would require an "invisible hand" to allocate all the resources to be a
What is another name of macroeconomics? Answer: Income theory
From the heterodox approach, what options does the enterprise have to produce more output? What impact do these options have on its cost structure?
Illustrate, why is tax not a capital receipt?
In saying that the present system of floating exchange rates is managed we mean that: IMF officials determine exchange rates on a day-to-day basis. countries that allow their exchange rate to move freely will lose their borrowing privileges with the IMF. the value of any IMF member's currency
‘Must a country which is less proficient at generating all goods use import controls to decrease imports from additional countries?’
When Sam Sleaze sells Terry Tone-deaf a low-quality stereo by promotion as the "top of the line", there is a trouble of: (1) Moral hazard. (2) Irrational ignorance. (3) Adverse choice. (4) Paradox of value. Can someone help me in g
What must be added to NNPMP to obtain net national disposable income? Answer: The Net current transfers from abroad must be added to NNPMP to get national disposabl
‘Over the precedent 30 years, and particularly as our entry into the EU, imports (and exports) as a proportion of GDP have increases considerably in the UK. What influence has this had on the value of multiplier in the UK?’
18,76,764
1928683 Asked
3,689
Active Tutors
1446463
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!