Analyzing Managerial Decisions: United Airlines

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Case Study 6 Analyzing Managerial Decisions: United Airlines Discontinuing United Airline flights from San Francisco to Washington D.C is not the best option in this case. In this case United Airlines need to view the calculation to make sure they are accurate and are reported accurately by WSJ. I also think the use of marginal analysis would be very beneficial in this case. Companies use marginal analysis as a decision-making tool to help them maximize their profits. Individuals unconsciously use marginal analysis to make a host of everyday decisions. Marginal Analysis also use to identify costs and benefits of different alternatives by examining the effect on total revenue and cost caused by one unit change in output and input(Economic Glossary). If WSJ numbers were accurately reported the operating prices from San Francisco to Washington D.C. wouldn’t have been included. I do not think United Airlines should discontinue their flights from San Francisco to Washington D.C. United Airlines should continue on with business and reevaluate the numbers and cost. After this evaluation United Airlines should look at the numbers from the flight to make sure it covers all cost associated. United Airlines should make sure the total revenue collected covers the cost of all the services stated. United Airlines should also consider competitive equilibrium due to the fact that firms produce output at the minimum point on their average cost curves (Brickley Smith & Zimmerman). After this analysis is completed and for some reason the numbers don’t match up then united Airlines should reevaluate the flights from San Francisco to Washington D.C. The issues should be whether or not all services and products are needed, and if some services and products need to be cut. The last issues to be address should be whether or not the flight itself should just be ran at a certain time

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