This is Just Nuts

"Scott en Aztlán" wrote in message
...
On Tue, 11 Jan 2005 11:44:29 -0500,
wrote:

Call me naive, just makes no sense at all to me.

You need to travel more, and take a course in economics (Capitalism).

The economics I'm familiar with suggests that things which cost less
to produce should be sold for lower prices.

That's an overly simplistic and altogether to common MIS-
understanding of market economics. Price has very little
connection to cost - price is based on what the market will
pay for a given item or service. Cost simply tells the seller
whether or not the item or service can be profitably sold at
the market price.

Bob M.

"Scott en Aztlán" wrote in message
...
On Tue, 11 Jan 2005 11:44:29 -0500,
wrote:

Call me naive, just makes no sense at all to me.

You need to travel more, and take a course in economics (Capitalism).

The economics I'm familiar with suggests that things which cost less
to produce should be sold for lower prices.

That's an overly simplistic and altogether to common MIS-
understanding of market economics. Price has very little
connection to cost - price is based on what the market will
pay for a given item or service. Cost simply tells the seller
whether or not the item or service can be profitably sold at
the market price.

Bob M.

wrote in message
ups.com...

"What the market will bear" drives the cost of the vast majority
of products I buy.

Minor nit to pick, mostly so no one gets confused here -
it drives the PRICE of those products in the market, not
the COST of them (which in the context of this discussion
has been used, as is typical, to mean the cost of producing
or providing the item or service).

Bob M.

wrote in message
ups.com...

"What the market will bear" drives the cost of the vast majority
of products I buy.

Minor nit to pick, mostly so no one gets confused here -
it drives the PRICE of those products in the market, not
the COST of them (which in the context of this discussion
has been used, as is typical, to mean the cost of producing
or providing the item or service).

Bob M.

"Scott en Aztlán" wrote in message
...

So you're suggesting that demand is higher for one-way tickets?

Of course not. The demand is very low; however, for what
demand exists, there is generally little alternative. Therefore the
airlines are free to maximize the revenue they can obtain from this
class of ticket by increasing the price to what those who DO have
to travel "one way" will still pay for that service.

Bob M.

"Scott en Aztlán" wrote in message
...

So you're suggesting that demand is higher for one-way tickets?

Of course not. The demand is very low; however, for what
demand exists, there is generally little alternative. Therefore the
airlines are free to maximize the revenue they can obtain from this
class of ticket by increasing the price to what those who DO have
to travel "one way" will still pay for that service.

Bob M.

"js" wrote in message
oups.com...
Scott - Note this from the article:

"One reason is that advanced purchase roundtrip fares come with so many
restrictions....The one-way fare, on the other hand, is completely
unrestricted."

The two tickets are not the same and as such they are not the same
price. If you buy a fully refundable/changeable roundtrip it will cost
you exactly twice the one-way fare. The difference in price is based
on a difference in the product and its relative value.

You can buy a 2-liter bottle of Coke for $0.79 or a 12 oz can from a
vending machine for $1.25.

The can is convenient, easy to drink and cold - for that you pay extra.
A one way ticket is convenient, easy to use, and flexible - for that
you pay extra.
What is it you are having a problem understanding?

js

In the old days you could buy that argument. In today's reality, however,
the difference from the restricted ticket to the unrestricted ticket is much
more than the perceived value of the more expensive ticket. In other words,
I can pay the extra $$ to change a trip, or even throw away a return ticket,
and still have a considerable amount of savings over a fully unrestricted
fare. That's the problem with airfares today. It is the perception of
value. For that reason, I hope what Delta has done in the U.S. catches on
and holds.

"js" wrote in message
oups.com...
Scott - Note this from the article:

"One reason is that advanced purchase roundtrip fares come with so many
restrictions....The one-way fare, on the other hand, is completely
unrestricted."

The two tickets are not the same and as such they are not the same
price. If you buy a fully refundable/changeable roundtrip it will cost
you exactly twice the one-way fare. The difference in price is based
on a difference in the product and its relative value.

You can buy a 2-liter bottle of Coke for $0.79 or a 12 oz can from a
vending machine for $1.25.

The can is convenient, easy to drink and cold - for that you pay extra.
A one way ticket is convenient, easy to use, and flexible - for that
you pay extra.
What is it you are having a problem understanding?

js

In the old days you could buy that argument. In today's reality, however,
the difference from the restricted ticket to the unrestricted ticket is much
more than the perceived value of the more expensive ticket. In other words,
I can pay the extra $$ to change a trip, or even throw away a return ticket,
and still have a considerable amount of savings over a fully unrestricted
fare. That's the problem with airfares today. It is the perception of
value. For that reason, I hope what Delta has done in the U.S. catches on
and holds.

On Thu, 13 Jan 2005 09:01:11 -0800 Scott en Aztlán
wrote:

:The only possible difference might be the restriction/refundability.
:However, if I'm booking a flight for TOMORROW, It's unlikely that my
:plans will need to change between now and the time my flight leaves.
:Not too much risk considering the savings.

I saw this on the CTA (Chicago light rail) some number of years ago.

The person paid his fare and went on the platform. He then received a call
that his meeting was canceled. He then went to the agent to get his fare back.
The astonished agent checked, and there actually were forms to do that.

--
Binyamin Dissen
http://www.dissensoftware.com

Should you use the mailblocks package and expect a response from me,
you should preauthorize the dissensoftware.com domain.

I very rarely bother responding to challenge/response systems,
especially those from irresponsible companies.

Scott en Aztl=E1n wrote:
On Thu, 13 Jan 2005 15:50:01 GMT, "Dennis G. Rears"
wrote:

Call me naive, just makes no sense at all to me.

You need to travel more, and take a course in economics
(Capitalism).

The economics I'm familiar with suggests that things which cost
less
to produce should be sold for lower prices.

Your economics never mentioned supply and demand?

So you're suggesting that demand is higher for one-way tickets?

Yes - actually it is - that is - the price sensitivity of DEMAND (slope
of the demand function), not the quantity demanded at a particular
price. Try consulting even the most basic economics text. Being naive
is not the same as being too lazy to learn.

Again, I'm obviously quite naive. I've flown on business many times,
but never on a one-way ticket. Don't most businesspeople want to come
back home at some point? So why don't they just purchase full-fare,
refundable/changeable round trip tickets? That's what I always do
when
I travel on business...

And the price of those is....twice that of a one way.
Congratulations.

js