AirlineOnline Problem Solving Questions

Please read the following scenario and answer the questions below. Mark only one option for each question.

Melbourne Airlines has experienced a drop of business over the last quarter resulting is a loss of $500,000. The CEO is very concerned and has asked for your advice to assist in improving the airline’s profit in a number of areas of the airline's operations.

6. In order to make sure the airline is profitable, I would foremost recommend to:

  • Increase airfares
  • Decrease staff salaries
  • Increase load factors
  • Ensure RASK is higher than CASK
  • Increase travel agent commissions

7. Which one of the following aspects is most important in airline revenue management…

  • Monitoring fares and ticket sales
  • Monitoring load factors
  • Discounting fares and offering high demand routes
  • Forecasting and monitoring ticket sales
  • Monitoring expenses and revenue

8. The Marketing Manager’s key responsibility is to…

  • Manage schedules and fares
  • Promote and advertise the airline
  • Discount tickets to sell more seats
  • Monitor load factors
  • Implement sustainability initiatives

9. Why is it important to monitor an airline's load factor?

  • Airline seats are perishable
  • The airline needs to breakeven
  • Airlines can increase their inventory
  • Customers book in advance
  • Fares constantly change

10. If the CEO decides to reduce staff wages, what is the most likely possible outcome…

  • Profits will increase
  • Staff will strike
  • Load factors will increase
  • Passenger demand will increase
  • RASK will increase

11. Which of the following would clearly be evident on Melbourne Airline's balance sheet if they leased new aircraft and added more routes last quarter?

  • Their expenses increased
  • Their short term debt increased
  • Their total assets increased
  • Their revenue increased
  • Their staffing increased

12. Melbourne Airlines had a cash balance of $320 million at the start of the quarter. If the airline generates $17 million from ticket sales and $4 million from cargo, and incurs expenses of $16 million and $3 million in taxes, what will the cash balance be at the end of the quarter?

  • $341 million
  • $322 million
  • $325 million
  • $2 million
  • $21 million


  • These problem solving questions are intended to test cognition prior to the simulation and are specific to each simulation.