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Unformatted text preview: The disadvantage to selling the seats at a discounted rate is that others who have already purchased seats at a higher price may be unhappy with the fact that they could have gotten the seats cheaper. Also a disadvantage is that Widgets might be able to sell the seats at full fare and earn a higher profit. I would try a 10 to 20 percent discount to start in order to still try and earn more revenue. However, the close to flight time the more of a discount I would offer to ensure the plane was full. Regardless of whether seats 11 through18 are sold the flight still has to take place and the same fixed costs will be incurred. So if seats 11-18 do not get sold Widgets will breakeven which mean no profit will be earned. If the other seats are sold whether it is at full price or at a discounted price Widgets will earn a profit....
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- Spring '12