2) BAA Airports Limited operates London's Heathrow Airport. Between 2008 and 2009, with the Great Recession,...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
2) BAA Airports Limited operates London's Heathrow Airport. Between 2008 and 2009, with the Great Recession, Heathrow passenger traffic fell by 1.5%. However, the proportion of long-haul traffic increased from 52.2% to 52.9% and the proportion of transfer passengers increased from 35.9% to 37.4%. (Source: BAA Airports Limited, Results for the year ended 31 December 2009.) a. Explain how passenger traffic affects the demand for retail services such as restaurants and shopping at the airport. b. Using relevant demand curves, compare airport passenger traffic at: (i) airports with retail facilities; and (ii) airports without retail facilities. Which airports would spend more on promoting passenger traffic? Assume that the airport maximizes the net benefit to all parts of the airport (including the retailers, if any). c. BAA's financial report remarked that "strong in-terminal shopping performance reflected a higher proportion of intraterminal transfer passengers, providing longer departure lounge dwell times for such passengers." Would you advise BAA to extend the transfer times between flights, so that passengers must spend more time at the terminal? 2) BAA Airports Limited operates London's Heathrow Airport. Between 2008 and 2009, with the Great Recession, Heathrow passenger traffic fell by 1.5%. However, the proportion of long-haul traffic increased from 52.2% to 52.9% and the proportion of transfer passengers increased from 35.9% to 37.4%. (Source: BAA Airports Limited, Results for the year ended 31 December 2009.) a. Explain how passenger traffic affects the demand for retail services such as restaurants and shopping at the airport. b. Using relevant demand curves, compare airport passenger traffic at: (i) airports with retail facilities; and (ii) airports without retail facilities. Which airports would spend more on promoting passenger traffic? Assume that the airport maximizes the net benefit to all parts of the airport (including the retailers, if any). c. BAA's financial report remarked that "strong in-terminal shopping performance reflected a higher proportion of intraterminal transfer passengers, providing longer departure lounge dwell times for such passengers." Would you advise BAA to extend the transfer times between flights, so that passengers must spend more time at the terminal?
Expert Answer:
Answer rating: 100% (QA)
Step 1 a When there is more inflow of the foreign tourists then it leads to more demand of the resta... View the full answer
Related Book For
Managerial Economics and Business Strategy
ISBN: 978-0071267441
7th Edition
Authors: Michael R. baye
Posted Date:
Students also viewed these accounting questions
-
The summarized statements for the year ended 31 December 2007 for Mat, Rug and P entities are as follows: Statements of comprehensive income for the year ended 31 December 2007 The following...
-
In preparing the financial statements for the year ended 31 December 20X5 Alpha plc discovers the following, all of which are material in the context of the company's results: Development...
-
The following information is available for the year ended 31 March 20X6 (values in $m): Present value of scheme liabilities at 1 April 20X5 $1,007; Fair value of plan assets at 1 April 20X5 $844;...
-
For Table 24.1, suppose you think that you omitted a relevant variable, physicians per capita. Would this harm your results for S or H? Explain your view. Table 24.1 (Model 1) The Effect of Community...
-
Repeat Prob. 620 but with an alternating torsional stress of 30 kpsi. Repeat Prob. 620, A bar of steel has the minimum properties Se = 40 kpsi, Sy = 60 kpsi, and Sut = 80 kpsi. The bar is subjected...
-
The bank portion of the bank reconciliation for Rintala Ltd. at November 30, 2017, was as follows. The adjusted cash balance per bank agreed with the cash balance per books at November 30. The...
-
Information management is the core of any environmental management system. Do you agree with this statement? How important is accounting information in an environmental management system? Outline...
-
Why is having multiple health-care plans important for FedEx in slowing down increases in the cost of benefits?
-
Ghost Ltd has just paid a $4 dividend. The dividend is expected to grow at 12% for the next 4 years. After that, the grow rate will be 4% indefinitely. If the required return is 16%, find the current...
-
Refer to The Appraisal Journal (Summer 2019) study of the valuation of single Refer to The Appraisal Journal (Summer 2019) study of the valuation of singletenant properties. Recall that the ratio of...
-
In logit and profit regressions, we used Excel to create a prediction of the probability based on the regression coefficients. How would you create a similar prediction using the coefficients from a...
-
A positive charge is being pushed by a 3 . 0 3 N / C field with a force of 8 1 . 0 7 N . What is the value of the charge ( in C ) ?
-
ESSAY INSTRUCTIONS Fifty points total. Please select one of the following six prompts. Please writ a succinct, comprehensive legal-historical analysis of your chosen passage. Please writ about...
-
What qualities should the job seeker communicate to the interviewer?
-
Fred and Ginger are getting divorced. Before they got married, they signed a premarital agreement.The premarital agreement states that if Fred and Ginger ever get divorced, Ginger does not get any...
-
Consider the following functions: void Q1 (int *sale, int *price, int quantity) { *sale (*price) * quantity; }; void Q2 (int profit, int *price, int cost) profit (*price) - cost; }; int Q3 (int...
-
In some organizations, the approved budget becomes the spending rule. In that case, something that isn't budgeted for can't be purchased. Respond to the following in a minimum of 175 words: Explain...
-
Test your confidence in the following Project Decisions: SI. # Question 01 02 03 04 05 06 07 08 09 10 How many years did it take to construct the largest Egyptian Pyramid- Pyramid of Cheops? When was...
-
You are the manager of a paper mill and have been subpoenaed to appear before a joint session of the Senate Consumer Affairs and the Senate Environmental subcommittees. The Consumer Affairs...
-
You are the manager of a firm that produces and markets a generic type of soft drink in a competitive market. In addition to the large number of generic products in your market, you also compete...
-
Explain the difference between the law of diminishing marginal returns and the law of diminishing marginal rate of technical substitution.
-
What is the purpose of tests of controls?
-
Why are some tests of controls performed during the interim period?
-
What four factors should the auditor consider in deciding what evidence, if any, needs to be obtained during the period from the interim date to the balance sheet date?
Study smarter with the SolutionInn App