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1) $2 per air mile for flight crew (pilot, Copilot..etc) 2) $.50 per air mile for each flt attendant. 1 flt attendant is required for each 50 passengers. 3) Fuel costs are 30 % greater flying west because of jet stream headwinds 4) Only round trip tickets are sold. Breakeven price. Cities Distance to Major cities Fixed cost Fuel variable cost: Customer per mile Fuel variable cost: Per customer Nonfuel cost: Per customer Total cost: Per customer Full Carrying Capacity Total cost: Full Capacity Breakeven Per ticket Tokyo 4,785 25,450 .012 2012 X 4,785-57.42 12.50 12.50+ 57.4269.92 467 467 x 69.92 + 25,450=58,102.64 58,102.64 / 467 - 124.42 Hong Kong 6,639 25,450 .012 .012 X 6,639=79.67 12.50 12.50 + 79.67-92.17 Seoul 5,166 25,450 .012 .012x5,166-61.99 12.50 12.50 + 61.99-74.49 467 467 x 74.49 + 25,450-60,236.83 50,236.83 / 467 - 128.99 467 467x92.17 +25,450-68,493.39 68,493.39/467 = 171.23-146.67 50 % Capacity Seoul 234 Cities Carrying capacity at 50% Total cost: Per customer Total cost: At 50 % capacity Revenue of tickets at 50% Price per ticket Tokyo 234 69.92 234 x 69.92 - 16,361.28 16,361 28/5=32,722.56 32,722.56/234 = 139.84 Hong Kong 234 92.17 234 x 92.17 = 21,567.78 21,567.78 / 5-43,135.56 43,135.56/234 - 184.34 74.49 234 x 74.49 = 17,430.66 17,430.66/ 5= 34,861.32 34,861.32/234 = 148.98 Pricing of remaining capacity Cities Total: Full capacity Revenue: for 234 customers Amount for other 233 customers Remaining capacity Price per ticket for 233 customers Tokyo 58,102.64 32,722.56 58,102.54-32,722.56 = 25,380.08 233 Hong Kong 68,493.39 43,135.56 68,493.39 - 43,135.56 -25,357.83 233 Seoul 60,236.83 34,861.32 50,236.83 - 34,861.32 = 25,375.51 233 25,380.08/233 = 108.93 25,357.83/233 = 108.83 25,375.51/233 = 108.91 1) $2 per air mile for flight crew (pilot, Copilot..etc) 2) $.50 per air mile for each flt attendant. 1 flt attendant is required for each 50 passengers. 3) Fuel costs are 30 % greater flying west because of jet stream headwinds 4) Only round trip tickets are sold. Breakeven price. Cities Distance to Major cities Fixed cost Fuel variable cost: Customer per mile Fuel variable cost: Per customer Nonfuel cost: Per customer Total cost: Per customer Full Carrying Capacity Total cost: Full Capacity Breakeven Per ticket Tokyo 4,785 25,450 .012 2012 X 4,785-57.42 12.50 12.50+ 57.4269.92 467 467 x 69.92 + 25,450=58,102.64 58,102.64 / 467 - 124.42 Hong Kong 6,639 25,450 .012 .012 X 6,639=79.67 12.50 12.50 + 79.67-92.17 Seoul 5,166 25,450 .012 .012x5,166-61.99 12.50 12.50 + 61.99-74.49 467 467 x 74.49 + 25,450-60,236.83 50,236.83 / 467 - 128.99 467 467x92.17 +25,450-68,493.39 68,493.39/467 = 171.23-146.67 50 % Capacity Seoul 234 Cities Carrying capacity at 50% Total cost: Per customer Total cost: At 50 % capacity Revenue of tickets at 50% Price per ticket Tokyo 234 69.92 234 x 69.92 - 16,361.28 16,361 28/5=32,722.56 32,722.56/234 = 139.84 Hong Kong 234 92.17 234 x 92.17 = 21,567.78 21,567.78 / 5-43,135.56 43,135.56/234 - 184.34 74.49 234 x 74.49 = 17,430.66 17,430.66/ 5= 34,861.32 34,861.32/234 = 148.98 Pricing of remaining capacity Cities Total: Full capacity Revenue: for 234 customers Amount for other 233 customers Remaining capacity Price per ticket for 233 customers Tokyo 58,102.64 32,722.56 58,102.54-32,722.56 = 25,380.08 233 Hong Kong 68,493.39 43,135.56 68,493.39 - 43,135.56 -25,357.83 233 Seoul 60,236.83 34,861.32 50,236.83 - 34,861.32 = 25,375.51 233 25,380.08/233 = 108.93 25,357.83/233 = 108.83 25,375.51/233 = 108.91

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