Question

In: Economics

The Federal Aviation Administration is a government agency that is in charge of air traffic control....

The Federal Aviation Administration is a government agency that is in charge of air traffic control. All of the capital equipment (radar, etc.) used by air traffic controllers is purchased through appropriations from Congress. When Apple Corporation purchases new capital equipment, the decision is made by owners and managers that believe the firm can get a return on investment from the new capital because the new capital can be used to produce new and improved goods for Apple customers. Which entity is likely to have more outdated capital and capital in need of repair or replacement? Why? Explain in detail.

Solutions

Expert Solution

The Federal Aviation Administration would have more outdated capital and capital in need of repair or replacement.

The Federal Aviation Administration being a government agency is established and operate with a purpose of achieving public objectives and as a tool to serve the government's objective of providing service to the people rather then earning and maximizing their profits. The private corporations on the other hand are driven by profit maximization motives and channelize all their effort and investments in that direction. When entities make investment in capital they make it with the objective of improving their efficiency, productivity which would in return help them augment their revenue and profits. When entities are not strongly driven by motives of improving their efficiency, productivity and profitability this gets reflected in their choices and investments they make in capital and other assets. Apple Corporation is not a government corporation, its survival depends on the its ability and capacity to earn revenue and profits, which in turn is determined by their decisions to make investments in augmenting their capacity, efficiency and productivity. If Apple corporation does not earn meaningful profits its very existence will be threatened as it will not have any other source for supporting its existence, whereas a government cooperation earning profits is not a concern as it is for the private entities as the government cooperation can always be bailed out by the government when they are not. This causes the private entities to be agile, proactive in making investment and other operating decisions so that they stay ahead in the game and do not lose their competitive advantage. They have to ensure that they operate in a productive manner and have a sustainable means of being relevant and lucrative in the market, this also enables them to earn and maintain  the goodwill of the shareholders. Private corporations are required to be proactive and decisive if they want to survive and grow in the market by and this can be achieved through being proactive and decisive in terms of making investment and operations plans and decisions, to be able to effectively for-see the future conditions and thus make a proactive - good, calculated, effective decisions pertaining to investments in capital and other avenues to improve their efficiency, productivity and profitability. They will adopt measures to ensure that they get best returns on their investment and take all the necessary steps to leverage their investments to the most to earn high returns. Government corporations are not bogged down by such headache and this gets reflected in their outlook which is usually lackadaisical and not proactive pertaining to making investments in capital, improving their revenue and profit earning capacity.


Related Solutions

The Federal Aviation Administration is a government agency that is in charge of air traffic control....
The Federal Aviation Administration is a government agency that is in charge of air traffic control. All of the capital equipment (radar, etc.) used by air traffic controllers is purchased through appropriations from Congress. When Apple Corporation purchases new capital equipment, the decision is made by owners and managers that believe the firm can get a return on investment from the new capital because the new capital can be used to produce new and improved goods for Apple customers. Which...
A public administrator for the Federal Aviation Administration, in light of terrorist bombings and hijacking of...
A public administrator for the Federal Aviation Administration, in light of terrorist bombings and hijacking of airplanes, was concerned about how four different methods of screening passengers affect traveler satisfaction. The four methods were (1) no screen, (2) walk-through metal detector, (3) frisk search, and (4) handheld metal detector. Random samples of traveler satisfaction were taken when the travelers were screened by one of the four methods. The sample sizes were n1=2, n2=3, n3=3, and n4=2 for the four methods....
The Federal Aviation Administration wants to determine the effect of alcohol on reaction time (apparently, they...
The Federal Aviation Administration wants to determine the effect of alcohol on reaction time (apparently, they really want to know how much booze a pilot can have before flying an airplane carrying hundreds of people). They conduct reaction time tests (measured in milliseconds, ms) on 10 pilots before and after consuming alcohol. Does alcohol affect reaction time? Data are seen below. Conduct a hypothesis test and construct a 95% C.I. for the pre/post test difference in reaction time. The Federal...
A Parasail rider wants to reach the maximum height allowed by the Federal Aviation administration... A...
A Parasail rider wants to reach the maximum height allowed by the Federal Aviation administration... A Parasail rider wants to reach the maximum height allowed by the Federal Aviation administration if the rider’s boat is to tow the parachute at 30 miles per hour. How should the tow to reach the maximum flying height? A. Draw and label a diagram to represent this situation. B. Explain two different methods to solving this problems Method 1: Method 2: C. Find the...
Federal Aviation Administration rules require airlines to estimate the weight of a passenger as 195 pounds,...
Federal Aviation Administration rules require airlines to estimate the weight of a passenger as 195 pounds, including carry-on baggage. Men have weights (without baggage) that are normally distributed with a mean of 172 pounds and a standard deviation of 29 pounds. a. If one adult male is randomly selected and is assumed to have 20 pounds of carry-on baggage, how likely is it that his total weight is greater than 195 pounds? b. If a Boeing 767-300 aircraft is full...
The Federal Trade Commission and the Federal Food and Drug Administration are government entities that investigate...
The Federal Trade Commission and the Federal Food and Drug Administration are government entities that investigate concerns relevant to fraudulent or misleading advertisements or product descriptions/contents. Your assignment is to research these entities (and any governmental agencies) that do such investigations and the outcome/consequences/sentence to a corporation when they are involved. Give your opinion as to whether such governmental agencies are necessary or can corporate entities self-monitor? Give 2 specific examples. Post your findings.
Because of safety considerations, in May 2003 the Federal Aviation Administration (FAA) changed its guidelines for...
Because of safety considerations, in May 2003 the Federal Aviation Administration (FAA) changed its guidelines for how small commuter airlines must estimate passenger weights. Under the old rule, airlines used 180 pounds as a typical passenger weight (including carry-on luggage) in warm months and 185 pounds as a typical weight in cold months. A journal reported that an airline conducted a study to estimate average passenger plus carry-on weights. They found an average summer weight of 183 pounds and a...
Suppose the Federal Aviation Administration (FAA) would like to compare the on-time performances of different airlines...
Suppose the Federal Aviation Administration (FAA) would like to compare the on-time performances of different airlines on domestic, nonstop flights. The following table shows two different airlines and the frequency of flights that arrived early, on-time, and late for each. To test at the 0.1 level to determine if Airline and Status are dependent, calculate the chi-square test statistic and p-value. Chart: 26 14 16 16 22 6 Question 4 options: 1) 7.37, the degrees of freedom is 6, and...
Because of safety considerations, in May 2003 the Federal Aviation Administration (FAA) changed its guidelines for...
Because of safety considerations, in May 2003 the Federal Aviation Administration (FAA) changed its guidelines for how small commuter airlines must estimate passenger weights. Under the old rule, airlines used 180 pounds as a typical passenger weight (including carry-on luggage) in warm months and 185 pounds as a typical weight in cold months. A journal reported that an airline conducted a study to estimate average passenger plus carry-on weights. They found an average summer weight of 183 pounds and a...
Suppose the Federal Aviation Administration (FAA) would like to compare the on-time performances of different airlines...
Suppose the Federal Aviation Administration (FAA) would like to compare the on-time performances of different airlines on domestic, nonstop flights. To determine if Airline and Status are dependent, what are the appropriate hypotheses? A)HO: Airline and Status are independent of each other. HA: Airline and Status display a positive correlation. B)Two of the other options are both correct. C)HO: Airline and Status are independent of each other. HA: Airline and Status are dependent on one another. D)HO: Airline and Status...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT