Part of The Student Room Group

  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Economics commentary on SpiceJet buys 30 Q400 aircraft from the times of India (website) and the article was published on 30th of August, 2011.

Extracts from this document...

Introduction

Economics Commentary The article I have chosen to base my commentary on is "SpiceJet buys 30 Q400" aircraft from the times of India (website) and the article was published on 30th of august, 2011. As the title suggests the article discusses about the recent acquisition made by SpiceJet of 30 Q400 aircrafts from Bombardier in order to reach out to more of the tier 2 and tier 3 cities in India, where there is a potential demand which has not been yet met entirely. These cities include Aurangabad, Bhopal, Indore, Mangalore, Rajahmundry, Tirupati and Vijayawada also SpiceJet will start operating direct flights to cities that is not easily available such as; from Hyderabad to Goa and Madurai, Nagpur to Pune and Bangalore to Vizag. ...read more.

Middle

Through these changes SpiceJet will be able to increase their customer base and reach out to a more niche market that had been previously neglected by them. This improvement in their route and by providing more aircrafts SpiceJet will enable them to increase their supply thus resulting in their prices to decrease (as can be seen on diagram 1). Moreover the Q400 aircrafts are comparatively much more fuel efficient which not only decreases their cost and hence allows them to offer "affordable journey to the common people" but also improves their public image because it promotes them as being environmental friendly and hence increase their demand thus bringing about an increase in the equilibrium quantity and price as well (as can be seen on diagram 2). ...read more.

Conclusion

In addition to this The Q400 aircraft due to its comfort would also benefit SpiceJet as more passengers would like to travel through it compared to other airlines thus causing the demand curve to shift upwards and thus allowing the prices to increase even further (as can be seen by figure 4). The Q400 aircraft are not only going to benefit SpiceJet but also millions of people and India as a whole since this would cause a drastic improvement in communications. Also it will set a trend for other airlines to also offer more routes and hence force the prices to go even lower as the competition will increase and the demand would become comparatively elastic (as can be seen by diagram 5). ?? ?? ?? ?? Prerna Gupta - 11 ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our International Baccalaureate Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

or


Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related International Baccalaureate Economics essays

  1. Growth and Development Problem Set - IB Economics exam questions and answers.

    A lesser-developed country is usually poor, as measured by per capita gross domestic product, and unmodernized. LDCs rely primarily on agriculture as a source of income and industrial practices usually contribute to less than 10% of the nation's GDP. Many African and Arab nations are considered to be lesser-developed countries.

  2. Macro Economics Notes

    Structural unemployment - training programs, retraining for the unemployed, reducing welfare benefits, investment in new technology Frictional unemployment - lower bureaucratic requirements, job centers, specialist newspapers advertising the available jobs etc. Inflation - cost-push and demand pull. Cost push inflation Inflation cause by rises in the AS, the same as the supply curve in micro-economics.

  1. Economics Commentary on Foreign Capital Shuns India

    However, it's existing problems in regularity systems and balance of payments are slowly deteriorating multinational corporations' appetites to engage further investments, hence make the country harder to sustain its economic growth. As the article has mentioned: "A $12 billion project by South Korean steelmaker Posco was only recently approvoed after five years of government delay."

  2. Human Research Management - Southwest Airlines

    It is unique and based on distinct characteristics and/or competences [such as first profit sharing plan (1974)1, approx. 85% unionized employees, member of Fortune 500, one way airfare, leader in low customers complaints, best on-time performance, best baggage, handling]. Have the same organizational mind turns to be prerequisite for being a successful competitor to SWA.

  1. Commentary on News Article

    at a price (P=4) shows a balance in offer and demand . So, now that corn is being more demanded for the production of biofuels, the preferences over this good are altered, making the corn more attractive. Now, because of this, at the initial level of equilibrium the quantity demanded

  2. Luxury Marques Look to India

    However, he said that while Tata Motors faced cyclical pressures similar to other producers, it was on track to bounce back. The group was spending $4bn-$5bn to revamp its product range, a move he said was essential to revive sales.

  1. Role of ICT for "Make in India" government initiative.

    Many felt that the labour reforms and policy reforms that bring success to this campaign have not yet been implemented so far. Solutions for Challenges faced by Manufacturing sector : It would be good if we start with basics. Infrastructure and Human capital still needs improvement in the country.

  2. Economics Commentary- Prices of onions jumped yesterday, buoyed by a ban by India on ...

    or maximum prices (price imposed below equilibrium price through legislation by the government to protect the interest of consumers) in order to control the onion prices. Provision of subsidy will result in a greater government expenditure which will have an opportunity cost (the next best alternative for government)

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work