Airlines and discounted tickets

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chidcguy: Master | Next Rank: 500 Posts; Posts: 438; Joined: Mon Feb 12, 2007 9:44 am; Thanked: 26 times

by chidcguy » Fri Jul 04, 2008 10:42 am

Several airlines have recently intensified their fierce competition for business by offering tickets that, if purchased 2 days in advance, cost as much as 40 percent less than the heretofore lowest-priced “super-saver” tickets, which require a 30-day advance purchase. The airlines’ long-term gains from tickets bought under this new plan will be enormous because, unlike earlier discount tickets, these are not refundable.

The author assumes which of the following about discounted airline tickets in predicting long-term gains in airline revenue?

(A) More discounted, advance purchase tickets are purchased than are actually used.

(B) Tickets requiring 30-day advance purchase are not profitable for airlines.

(C) Few business travelers have taken advantage of 30-day advance purchase tickets.

(D) Airlines will have to discontinue offering 30-day advance purchase tickets when they begin offering 2-day advance purchase tickets.

(E) The majority of the 2-day advance purchase tickets offered by a given airline will be sold to passengers who have not previously flown on that airline

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Source: Beat The GMAT — Critical Reasoning | Fri Jul 04, 2008 10:42 am

raunekk: Legendary Member; Posts: 1159; Joined: Wed Apr 16, 2008 10:35 pm; Thanked: 56 times

by raunekk » Fri Jul 04, 2008 1:07 pm

IMO:A

( not sure)

Explanation if its the OA!!

thx

leswm: Junior | Next Rank: 30 Posts; Posts: 13; Joined: Fri May 04, 2007 10:58 pm

by leswm » Fri Jul 04, 2008 1:45 pm

I'm curious, where did you find this question? It just doesn't seem GMAT-ish.

Argument: 2 day tickets cost 40% < 30-day tickets, but since they're non-refundable, long-term gains will be huge.

A is the most appealing, though I don't like it. The others are just out. Here's why:

(B) Tickets requiring 30-day advance purchase are not profitable for airlines.
We don't necessarily have to assume that the 30-day tickets are NOT profitable. They could still be less profitable and the argument still holds. The argument is about 2-day tickets.

(C) Few business travelers have taken advantage of 30-day advance purchase tickets.
Irrelevant. So what if business travelers haven't taken advantage. What about other travelers? Even then, it doesn't explain why the 2-day tickets would have huge gains.

(D) Airlines will have to discontinue offering 30-day advance purchase tickets when they begin offering 2-day advance purchase tickets.
Even if the 30-day tickets have to be discontinued or even continued for that matter, it doesn't help me understand why the 2-day tickets will have huge gains. Plus I personally think that assumptions of things to be done in the future aren't solid.

(E) The majority of the 2-day advance purchase tickets offered by a given airline will be sold to passengers who have not previously flown on that airline
You'd have to make further assumptions about the passengers who haven't flown on that airline e.g. new passengers are somehow going to be responsible for the enormous long-term gains. This is going to far, so we'd have to cross this one out.

chidcguy: Master | Next Rank: 500 Posts; Posts: 438; Joined: Mon Feb 12, 2007 9:44 am; Thanked: 26 times

by chidcguy » Fri Jul 04, 2008 2:49 pm

This is from a paper based test.

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agent47: Senior | Next Rank: 100 Posts; Posts: 73; Joined: Sat Apr 19, 2008 11:16 pm

by agent47 » Sat Jul 05, 2008 7:49 am

A is the best answer for me 2

chidcguy: Master | Next Rank: 500 Posts; Posts: 438; Joined: Mon Feb 12, 2007 9:44 am; Thanked: 26 times

by chidcguy » Sat Jul 05, 2008 8:03 am

A is saying

More discounted, advance purchase tickets are purchased than are actually used.

I felt its a keeper but ruled out in the end. My reasoning was how will it help a n airline that has sold 50 discounted tickets on a flight to make enormous profits. even if 5 of them show up, the airline has to fly from A to B. On the flip side, a lot of people (like business fliers) who know that they will have more cancellations might be just buying regular tickets.

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svaradhan: Senior | Next Rank: 100 Posts; Posts: 34; Joined: Thu Apr 03, 2008 12:01 pm; Thanked: 2 times

by svaradhan » Sat Jul 05, 2008 12:04 pm

I felt its a keeper but ruled out in the end. My reasoning was how will it help a n airline that has sold 50 discounted tickets on a flight to make enormous profits. even if 5 of them show up, the airline has to fly from A to B. On the flip side, a lot of people (like business fliers) who know that they will have more cancellations might be just buying regular tickets.

The above explanation assumes a lot of things that are not stated in the argument.

NSNguyen: Master | Next Rank: 500 Posts; Posts: 401; Joined: Fri May 04, 2007 9:21 amFollowed by: 1 member; Thanked: 3 times

by NSNguyen » Sat Jul 05, 2008 10:42 pm

I choose A

Please share your idea and your reasoning

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peter.p.81: Master | Next Rank: 500 Posts; Posts: 300; Joined: Mon Apr 07, 2014 7:58 am

by peter.p.81 » Wed May 11, 2016 1:06 am

I would go for A as well. It seems the best and safest among the rest.

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