AVIT 405 EXAM 1 EXAM QUESTIONS WITH
100% CORRECT ANSWERS
4 stages of development for airlines
Regulation
Liberalization
Deregulation
Re-regulation
Purposes of re-regulation [3]
Prevent uncontrolled growth through mergers
Restrict airlines from selling tickets below actual cost
Maintain service frequency
Top 3 expenditures for airlines
Fuel (~40%)
Labor
MX
% of airports in the U.S. that has no air carrier service
95%
Airmail was first formed as a joint between...
Post office and the war department
Kelly Act of 1925
Allowed the government to outsource air mail service
What did the Kelly Act of 1925 create?
Airlines that would later become the majors (American, Northwest, United, etc.)
What did the Air Commerce Act of 1926 create?
FARs
What did the Air Commerce Act of 1926 encourage?
Development of commercial aviation and started the early airlines
Airmail Act of 1935
Privatized airmail and airlines, thus creating a new field of work, airline management
Civil Aeronautics Act of 1938
, Defined air carrier as a common carrier that operates for compensation or hire
What did the Civil Aeronautics Act of 1938 establish?
Civil Aeronautics Authority (CAB)
What was the CAB responsible for? [4]
Regulation of passenger fares
Established airmail rates
Granted and allocated routes
Approval for air transport related mergers/acquisitions
When did we start seeing more efficient aircrafts?
After WWII due to technological innovations during the war
What did the Federal Aviation Act of 1958 create?
The FAA
FAA vs CAB at the time of FAA's creation
FAA was responsible for safety, but CAB was responsible for route allocation, accident
investigation, and fare applications
When did we start seeing jets?
Late 1950s
Airline Deregulation Act of 1978
Removed government control over fares, routes and market entry (of new airlines) from
commercial aviation
Reasons for airline dereguation [5]
CAB concluded that regulation led to inefficiency
Introduction of widebody aircrafts
Middle Eastern Oil Embargo led to inflation
Overcapacity (American's SuperSaver fares)
Deteriorating financial condition of airlines
What did the congress approve in 1977 for cargo carriers?
The freedom to operate any domestic route and charge whatever the public could bear
Pros of airline deregulation [3]
Increased efficiency
Increased services
Lower prices
100% CORRECT ANSWERS
4 stages of development for airlines
Regulation
Liberalization
Deregulation
Re-regulation
Purposes of re-regulation [3]
Prevent uncontrolled growth through mergers
Restrict airlines from selling tickets below actual cost
Maintain service frequency
Top 3 expenditures for airlines
Fuel (~40%)
Labor
MX
% of airports in the U.S. that has no air carrier service
95%
Airmail was first formed as a joint between...
Post office and the war department
Kelly Act of 1925
Allowed the government to outsource air mail service
What did the Kelly Act of 1925 create?
Airlines that would later become the majors (American, Northwest, United, etc.)
What did the Air Commerce Act of 1926 create?
FARs
What did the Air Commerce Act of 1926 encourage?
Development of commercial aviation and started the early airlines
Airmail Act of 1935
Privatized airmail and airlines, thus creating a new field of work, airline management
Civil Aeronautics Act of 1938
, Defined air carrier as a common carrier that operates for compensation or hire
What did the Civil Aeronautics Act of 1938 establish?
Civil Aeronautics Authority (CAB)
What was the CAB responsible for? [4]
Regulation of passenger fares
Established airmail rates
Granted and allocated routes
Approval for air transport related mergers/acquisitions
When did we start seeing more efficient aircrafts?
After WWII due to technological innovations during the war
What did the Federal Aviation Act of 1958 create?
The FAA
FAA vs CAB at the time of FAA's creation
FAA was responsible for safety, but CAB was responsible for route allocation, accident
investigation, and fare applications
When did we start seeing jets?
Late 1950s
Airline Deregulation Act of 1978
Removed government control over fares, routes and market entry (of new airlines) from
commercial aviation
Reasons for airline dereguation [5]
CAB concluded that regulation led to inefficiency
Introduction of widebody aircrafts
Middle Eastern Oil Embargo led to inflation
Overcapacity (American's SuperSaver fares)
Deteriorating financial condition of airlines
What did the congress approve in 1977 for cargo carriers?
The freedom to operate any domestic route and charge whatever the public could bear
Pros of airline deregulation [3]
Increased efficiency
Increased services
Lower prices
