Decision Making and relevant factors: You have an opportunity to choose a flight for your upcoming...

Decision Making and relevant factors:

You have an opportunity to choose a flight for your upcoming spring break trip to Hawaii. After a lot of thought and research, you have narrowed your options to four different flights. If there are no delays, each should you to your destination on time. It is important to arrive on tim, since you have to meet a but at a specific time to take you and other students to your final destination. If any of the flights are late, arranging for alternative transportation will be difficult. Basic info. About each flight is as follow:

	Flight 1	Flight 2	Flight 3	Flight 4
Base Price	$300	$400	$500	$600
Flight Time and Connections	12hrs/3	6hrs/2	5hrs/1	3hrs/direct
first class upgrade	NA	$250	$200	$300
Meals (airport and plane)	$30	$15	$10	included in fare
wireless internet access	NA	$20	$25	included in fare
Beverages	$10	$10	$10	included in fare
Total Price all options	$340	$695	$745	$900

What are the relevant factors affecting your choice of flight? Explain.

Expert Solution

The restricting factor in the given situation is that it is important to reach on time in order to catch the bus at particular time. Hence, the relevant factor is Flight time and connections.

On comparison of the duration, flight 1 takes 12 hours whereas flights 2, 3 and 4 take 6, 5 and 3 hours respectively. If we consider flight 2 better than flight 1, flight 1 has 3 connections points whereas flight 2 has only 2. Flight 3 takes further less time to reach but only 1 connection point. Flight 4 takes 3 hours but there is a connecting flight again (implying that there is a single connection point).

We should also compare the costs of each flight and the further connection before making the decision. Flight 1 has the most economical price.

However, in the given situation, as price and other factors are not limiting factors, Flight time and connections is the most limiting factor and relevant factor for decision making.

ekkarill92 answered 2 months ago

Are opportunity costs relevant to decision making?

Why don't we include sunk costs in decision making? Define relevant costs and opportunity costs and...

Why don't we include sunk costs in decision making? Define relevant costs and opportunity costs and explain how they're different from sunk costs.

Now that you have completed your decision matrix, you will discuss your decision-making process and how...

Now that you have completed your decision matrix, you will discuss your decision-making process and how you have used the matrix. For this discussion, you should NOT post your matrix but rather use it as a tool to evaluate your business. In your initial post, address the following: Explain how you could use the matrix in a different business/technology scenario. Give an example. What was the most challenging part of applying this matrix to the final project? What recommendations would...

Why are relevant costs important in decision making? Explain sunk costs, incremental costs, opportunity costs, make...

Why are relevant costs important in decision making? Explain sunk costs, incremental costs, opportunity costs, make or buy decisions and strategic costing giving examples of each.

what external factors will you consider when making a decision

What factors are most relevant to an individual's decision to retire?

Mastery Problem: Decision Making using Differential Analysis Decision making involves quantifying relevant revenues and costs with...

Mastery Problem: Decision Making using Differential Analysis Decision making involves quantifying relevant revenues and costs with the goal of maximizing net cash flows. In many situations it is difficult to quantify all the important elements of a decision. Fixed costs are generally in the short-term because they are often unavoidable. Costs that have been incurred in the past and cannot be recouped are not relevant. These costs are called . Revenue given up by not choosing an alternative is relevant....

we learn that decision making, factors that affect decision and environmental factors (controllable and uncontrollable) affect...

we learn that decision making, factors that affect decision and environmental factors (controllable and uncontrollable) affect both the decision made and their corresponding outcomes It is asserted that "When it comes to financial decisions, what you know makes more difference than how fast your brain is.". In light of this thread and issue we cover this week, please decision whether or not the quoted text is correct? Please discuss your answer.

Why is it that sunk costs are never relevant to a decision whereas opportunity costs are...

Why is it that sunk costs are never relevant to a decision whereas opportunity costs are always relevant? Why do you think Goldratt’s Theory of Constraints received so much press by the business community?

How do you identify relevant information for decision making? How do you determine the qualitative and...

How do you identify relevant information for decision making? How do you determine the qualitative and quantitative impacts of special order pricing? How do you determine the qualitative and quantitative impacts of outsourcing decisions?

Question