Quote:
Originally Posted by mikeecho
I know it's been referenced in this thread before, but look no further than airlines and how they handle the various airport improvement fees (AIF). They don't see that as their cash contribution to each airports maintenance because they were prevented from charging that much more for a ticket. They see it as a fee they collect on behalf of the airport to improve the facility.
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Competition in airports keep pricing down so the maximum price an airline can charge is the cost another airline can make a profit at. Therefore the AIF is not an opportunity cost to the airline.
There is no competition for the flames that is also paying the fee so the opportunity cost is the Flames.
If an airline has a monopoly on a particular route then the AIF does limit the amount they can charge and therefore it's an opportunity cost to the airline.