o Shifts and price elasticity of supply and demand
o Positive and negative externalities
o Wage inequality
o Monetary and fiscal policies
• Conclude your paper with final thoughts on:
o How the economy affects the success of your chosen industry
o Economic influences that can affect the industry in a negative way.
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Answers:
Impact on The Airlines Industry
Introduction: The airline industry provides air transport services for passengers or cargo. They need to have a recognized operating certificate or license to operate. In order to deliver these services, airlines lease or own their aircraft and may form partnerships or alliances with other airlines for joint gain. The airlines industry is influenced by various forces. The elasticity of demand is influenced by externalities. The September 11th tragedy had a negative affect on the entire travel industry. It not only influenced the fiscal and monetary policies, supply and demand but it also created staffing problems nationwide.
Shifts and price elasticity of supply and demand: In the airlines industry shifts in pricing is one of the key factors which influence airlines revenue since it controls different features of market supply and demand. The elasticity of demand is based on current market conditions and available substitutes. The prices for itineraries differ in different seasons for e.g. winter versus summer. Pricing decisions consists of price adjustments due to a number of markets and competitor appraisal. Therefore prices in important markets are always scrutinized and adjusted in response to competitive pressures and there are special sales until about a month before departure.. (get full answer...yeah its 5 pages long!!
