(Answered) 1 suppose two firms southwest airlines and united

Management Studies

1. Suppose two firms, Southwest Airlines and United Airlines, are competing in the commercial airline market in which downstream buyer preferences are identical. Suppose United Airlines charges some positive price for a major corporation to sign an agreement for discounted fares for its employees and Southwest Airlines doesn't.

a. Is airline travel a search good or an experience good? Explain.

b. Which firm is likely to provide the greatest value created? Explain.

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