Fly-by-Night Airways provides air transportation servicesbetween New York and Miami. A single New York to Miamiround-trip has the following operating statistics:
Fuel 3,540
Flight crewsalaries 7,310
Airplanedepreciation 2,995
Variable cost per passenger - businessclass 45
Variable cost per passenger - touristclass 35
Round - trip ticket price - businessclass 350
Round - trip ticket price - touristclass 225
It is assumed that the fuel, crew salaries, and airplanedepreciation are fixed, regardless of the number of seats sold forthe round - trip flight.
- Compute the break - even number of seats sold ona single round - trip flight for the overallproduct. Assume that the overall product is 20% business classand 80% tourist class tickets.
- How many business class and tourist seats would be sold at the break - even point?