Airlines scramble to find new revenue streams
The days of the all in one ticket price - a simple means of flying from A to B are looking like a distant memory. The global aviation industry is set to lose up to $30bn this year and with average ticket prices continuing to decline and capacity utilization falling, the airlines are falling over themselves to find extra ways of getting passengers to part with their cash.
New wheezes include asking passengers to pay for the right to choose a seat, together with the growth of charges for baggage check-in and meals on board. If you are willing to pay in advance, travel light, book online and check-in online in a seat of the airline’s choice, you can still find very cheap flights. But the extras amount to a premium on choice and flexibility - I guess this is an example of the hurdle model of price discrimination - BA has launched a second-bag check-in fee on some of its flights and a reservation fee for passengers wanting to book particular seats more than 24 hours in advance of flight time. Day by day it is starting to resemble a budget airline in tactic as well as consumer goodwill. I booked a return flight to Hong Kong today with Cathay Pacific - no tedious optional extras - what a refreshing change!
This BBC video is good on the new a la carter revenue policies of airlines.
A2 Micro Multiple Choice Quiz
A ten question multiple choice quiz on aspects of introductory theory of the firm can be found here
Launch interactive version of the quiz
Download SCORM-VLE Zip file (import to your VLE)
Rated: 
(3/5), based on 2 reviews
Most Popular Topic Tags on the Economics Blog
recession, demand, economics, price, unemployment, prices, inflation, investment, costs, profit, downturn, supply, trade, debt, employment, confidence, euro, gdp, competition, capacity, risk, production, china, oil, incentives, exports, expectations, housing, pay, manufacturing, sterling, food, profits, property, mortgage, tutor2u, globalisation, banks, revision, slowdown, borrowing, usa, retailers, emissions, deflation, airlines, innovation, dollar, supermarkets, entrepreneur, efficiency, monopsony, elasticity, aqa, welfare, consumption, economist, productivity, keynes, saving, google, wealth, opec, depression, moodle, depreciation, jobs, competitiveness, credit crunch, economic cycle, cars, tim harford, externalities, stocks, infrastructure, environmental, strategy, carbon, vle, monopoly, subsidy, evaluation, eu, management, losses, protectionism, inequality, spare capacity, environment, poverty, bank of england, budget deficit, construction, behavioural, wages, macroeconomics, carbon trading, steel, commodities, output gap, skills, japan, oligopoly, imports, currencies, bbc, stagflation, contestable, agflation, cpi, farming, newsnight, choices, regulation, survey, taxes, government failure, itunes, minimum wage, lse, climate change, paul mason, population, intervention, keynes society, aviation, amazon, fiscal stimulus, single market, pricing, dan ariely, cartel, nationalisation, pollution, eton college, interest rates, shareholder, london, rationality, redundancies, market failure, rpi, mpc, shipping, behavioural economics, germany, robert peston, india, rsa, reputation, currency, quantitative easing, facebook, income elasticity, current account, stakeholders, brazil, coffee, savings, microsoft, monetary policy, crowding out, barriers to entry, collapse, multiplier effect, suppliers, economies of scale, price discrimination, uk economy, development, quiz, apple, surplus, taxation, labour market, tesco, free, scrappage, behaviour, tragedy of the commons, opportunity cost, open source, vat, smoking, cost of living, poverty trap, merger, growth, speculation, edinburgh, discrimination, ownership, cost benefit analysis, northern rock, global, ireland, supply chain, oecd, shareholders, scarcity, balance of payments, petrol, liquidity, duopoly, etonomics, iphone, trade deficit, starbucks, happiness, budget, human capital, subsidies, capital, immigration, eurozone, takeover, ecb, paradox of thrift, exploitation, advertising, wiki, public sector, utility, wants, labour force survey, peter day, tax, brand, blog, poland, iceland, foreign exchange, recovery, indirect tax, european union, robert frank, roger bootle, ocr economics, heathrow, hbos, hotels, freight, creative destruction, federal reserve, kaletsky, price war, information failure, spain, crude oil, transport, government borrowing, gini coefficient, sony, leverage, migrants, us economy, animal spirits, fishing, stephanie flanders, waste, information, milk, eu enlargement, anchoring, obama, aggregate demand, entrepreneurship society, needs, forecast, internet, discounting, real income, copper, deficit, contestability, nissan, evan davis, companies, fairness, geoff riley, blogging, standard of living, aqa economics, consumer welfare, martin wolf, renewable, labour mobility, collusion, imf, fair trade, pubs, income tax, obesity, res, disposable income, david smith, corus, national debt, devaluation, consumer surplus, vacancies, sub-prime, tariff, global economy, price capping, joint venture, twitter, accelerator effect, startups, guardian, yuan, youth unemployment, immobility, edmund conway, edexcel economics, redundancy, tata, walmart, relative poverty, sentiment, coal, tickets, vehicles, cash, diesel, base rate, russia, liquidity trap, contestable market, marginal cost, external shocks, movies, income elasticity of demand, libor, broadband, fixed costs, comparative advantage, accelerator, allocative efficiency, economic efficiency, pensions, training, king of shaves, satisficing, trend growth, undercover economist, hot money, congestion, price mechanism, deleveraging, positional goods, migration, jobless, social entrepreneur, apprenticeships, hyperinflation, age structure, cyclical, chris coleridge, monopoly power, financial times, ucas, pay cuts, reserve currency, ryanair, wheat, mervyn king, aldi, law of unintended consequences, carbon tax, gillette, deindustrialisation, yahoo, organic growth, barclays, price volatility, derived demand, liberalisation, house prices, richard thaler, royal mail, markets, diseconomies of scale, veblen goods, paul krugman, schumpeter, pension, demography, structural, logging, green revolution, tax burden, savings ratio, ocr, the economist, nhs, job losses, biofuel, drugs, gold, nelson thornes, scotland, cross elasticity, brics, redistribution, footfall, british airways, research, producer welfare, ebea, income distribution, social costs, ft, enterprise, general motors, natural monopoly, tariffs, o2, deforestation, economic welfare, bonds, asda, will king, automatic stabilisers, landfill, economax, energy, long tail, jim o'neill, disincentives, resources, profit margin, podcast, share prices, external shock, slump, philip allan, hedge fund, students, fiscal drag, hysteresis, ftse, elasticity of supply, buy to let, logic of life, contraction, equity, market structure, global business, oil prices, market power, health, ben bernanke, hedging, enlargement, retailing, supply-side, declan curry, nokia, price fixing, chris anderson, bric economies, diane coyle, dynamic efficiency, stimulus, hamish mcrae, toyota, john kay, fiscal policy, winners curse, zimbabwe, compound interest, contestable markets, frictional, rory cellan-jones, status races, claimant count, green shoots, repossession, eastern europe, healthcare, royal economic society, sustainability, public good, credit, superfreakonomics, vertical integration, inflationary pressure, invention, accession countries, probability, sustainable growth, gnp, fairtrade, freemium, g20, affordability, nairu,All tags
ECONOMICS TEACHER RESOURCE NEWSLETTER
Join over 4,000 other Economics Teachers in the UK and around the world who receive the tutor2u Economics Resource Email newsletter. Get special offers, first news of latest resources, teaching ideas, conferences and workshops.
Recent Threads on the Economics Teacher Discussion Forums:
Posts in: General Economics Teaching
Video Case-study - lunchtime prices slashed
Long Exam Example to Use for Revision Please?
Good hotel in London for school trip
Competitive Markets
Diminishing Returns
Complementary goods - HELP Please!
URgent Help Needed
Equilibrium concept
The price of life
Extended Project Qualification
