IMO: C
Argument:
- Airlines will reduce their price to a point which they lose money in order to eliminate competition.
- This method of eliminating competition cannot be profitable in the long run.
Conclusion:
- Any attempt to recoup lost revenue by charging higher rates for an extended period provides competitors with an opportunity to undercut the airline's price.
(A) is irrelevant IMO
(B) Supports the arguement in stating an airline which once cut prices to eliminate competition will do so again. If the airline reduces its price a second time they are cutting into their profits.
(C) As part of promotions, airlines sometimes price their tickets below an economically sustainable level. Leads me to believe that competitors are not looking for an opportunity to undercut a competitor airline's price, rather they are looking to promote their airline.
(D) Out of scope, the passage does not mention airlines reducing operations
(E) Out of scope, the passage does not mention the number of passengers
What is the OA?
