... to the non-business customer, the demand is quite elastic. This statement is true because when ticket prices increase, the number of tickets purchased decrease. The overall elasticity decreases when the business customers are added to the equation. The basic concept is that when someone ... Because of the elasticity of the industry, "cutthroat competition" can, and does, become a significant obstacle to overcome. Because the demand for airline travel is elastic, substitutes could add another dimension to the mix. Business and non-business consumers could both utilize substitutes, but it w...

• Word Count: 1371
• Approx Pages: 5
• Grade Level: Undergraduate

... . Until 1978, air transport rates were approved by the government, which meant that price was not a primary competitive factor. Instead, airlines would compete on service and image. The airline industry was dominated by giants (American, United, TWA) which offered nationwide and some international service, and by regional carriers, such as Southwest, which offered short trips between airports not ... the early 1990's. Unfortunately, ValuJet suffered a string of accidents which brought the future of this air carrier into question. ValuJet is a low-priced airline that offers inexpensive tic...

• Word Count: 1699
• Approx Pages: 7
• Grade Level: Undergraduate