Question: Airlines are said to have high operating risk. Why?

Airlines are said to have high operating risk. Why?

Step by Step Solution

★★★★★

3.42 Rating (158 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock

Airlines have high fixed expenses relative to variable expenses so if s... View full answer

blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Document Format (1 attachment)

Word file Icon

99-B-A-V-I (469).docx

120 KBs Word File

Students Have Also Explored These Related Accounting Questions!

Q:

Players in sports are said to have hot streaks and cold streaks. For example, a batter in baseball might be considered to be in a slump, or cold streak, if he has made 10 outs in 10 consecutive...

Q:

Market theories are said to have the happy consequence of getting individuals to think in more focused and analytical ways. Has this happened to you? Give examples to illustrate.

Q:

Why is a high risk premium is an advantage for the investor? Why is a low risk premium an advantage for the investor?

Q:

For the Time Value of Money, can you include specific numbers in the paper such as NPV, perhaps use the loan and interest of the building to find the future value or incorporate the cash flow...

Q:

BUSINESS RISK AND FINANCIAL RISK Operating Leverage reflects amount of fixed costs embedded in a firm's operations. Thus, ifa high percentage of a firm's costs are fixed, hence continue even if sales...

Q:

Fill in the blank using a number of terms listed below (@1 point). Business risk, Capital budget, Capital rationing, Capital structure, Financial leverage, Financial risk, Fixed charges, Flexibility,...

Q:

Hi There, I need someone to help me with the attached finance worksheet. There are 3 problems in this excel file - one problem on each individual tab. I am attaching a couple of additional files as...

Q:

Firms with high fixed costs and low variable costs are generally said to have high operating leverage. Firms with high debt are said to have high financial leverage. Which combination of leverages...

Q:

Firms with hgh fixed costs and low variable costs are generally said to have high operating leverage. Firms with high debt are said to have high financial leverage. Which combination of leverages...

Q:

In your own words summarize what you understand from the above chapter summary. SUMMARY Earlier chapters explained how companies calculate a project's NPV by forecasting the cash flows and...

Q:

Explain what types of policies a central bank can implement to reduce the interest rate ? Do these policies remain effective in reducing interest rate all times ( periods of recessions and expansions...

Q:

In Problems find the pivot element, identify the entering and exiling variables, and perform one pivot operation. 231-8 P0001 83 1 25 82 1 000 Sj 2-45-6 . 0 0 10

Q:

Transform the differential equation 7 y ' ' + 5 8 y ' ' - 6 3 y ' - 5 2 2 y = 9 e - 7 t y ' ( 0 ) = 0 y ' ( 0 ) = 0 y ' ' ( 0 ) = 1 into an algebraic equation by taking the Laplace transform of each...

Q:

Make a question from The Yellow backdrop. the question must be standard here is sample question - At the beginning of The Yellow Wallpaper, the narrator shares that she is sick. Her husband and...

Q:

Q.2) (3 Marks) The two objects in the following figure oscillate frictionless surface with a period of. The upper block just begins to slip when the amplitude is increased to. What is the coefficient...

Q:

Q1: (10 points) Using Verilog on www.edaplayground.com, write a test bench code for the following circuit: A wl GI G3 D B G2 E Assuming gates have: and has 30 ns or has 20 ns not has 10 ns

Q:

Q4) Let p(x) be the polynomial that interpolates f (x) at (*o, Yo) and (x,, y) .Prove that the error bound in this interpolation (for any x ) is 2 Mh f" (x) on [*, , xl. // ,where M is the maximum of...

Q:

Describe the period of turbulence that occurs between a companys growth phase and its mature phase.

Q:

Betty Li, the CFO of a company applying for a new loan, argues: I will never agree to a debt covenant that restricts my ability to pay dividends to my shareholders, because it reduces shareholder...

Q:

Cambridge Construction Company follows the percentage-of-completion method for reporting long-term contract revenues. The percentage of completion is based on the cost of materials shipped to the...

Q:

Can Cambridge improve its Z score by behaving as the analyst claims in Question 6? Is this change consistent with economic reality? AppendixLO1

Q:

Four years ago, you acquired a 30-year loan of $140,100, charging 6.6% annual interest, compounded monthly, and requiring monthly payments. At this time, interest rates on 20-year loans have dropped...

Q:

1. Assume that the readings at freezing on a bundle of thermometers are normally distributed with a mean of 0C and a standard deviation of 1.00C. A single thermometer is randomly selected and tested....

Q:

A project that provides annual cash flows of $15,800 for 8 years costs $84,292 today. Required: (a)If the required return is 8 percent, what is the NPV for this project? (Click to select)...