edf40wrjww2CF_PaperMaster:Desc
After Iraq’s oil supply was disrupted in the second Gulf War, the price of jet fuel used by airlines increased dramatically. As the CEO of US Airways, you have been presented with the following options to deal with this problem:
A. Raise airfares to reflect the expense reduction
As stated in the text, good decision making is the key to successful managerial performance. As the CEO I would be forced to raise the airfare. If I did not raise the airfare, I would be putting myself in a position to have to close down (maybe), lose business to other airlines, or maybe even have to lay off employees. This may be drastic, but as the CEO, I would have to do the best thing for the airline. Identifying that the problem ;which is that the oil prices are increasing, is the first step that I would take according to the text. The next thing I would do is make the hard decision which in this case would have to be to raise the airfare prices. This is a realistic situation for today. The airline prices seem to rise every day. There has even been a closure or two because some airlines cannot afford to stay open, and continue to make a profit if the cost of a barrel of oil keeps rising.
As I stated earlier, as a CEO of US Airways I would raise the cost of the airfare. I would think of the bottom line of the airline first, and then I would think of the customers. I know that I would probably lose business due to the increase in airfare but it is something that I would be pushed to do if I want to stay in business. I would lose a few customers but, I would still be functioning as an airline. ...