Activity assignment for MBA Managerial Economics

_ Reading:  
o Chapter 13: Advanced Topics in Business Strategy
o Chapter 14: A Manager’s Guide to Government in the Marketplace
Activity — At least 3 pages of content (including Introductory paragraph and a conclusions section, excluding graphs, title page, reference page, and the appendix section), and 3 peer-reviewed references are required by professors.  Course Learning Outcomes: Evaluate and present the economic basis for limit pricing, and identify the conditions under which a firm can profit from such a strategy.
Between 1995 and 1997, American Airlines competed in the Dallas/Ft. Worth Airport against several other low-cost carriers. In response to these low-cost carriers, American Airlines reduced its price and increased service on selected routes. As a result, one of the low-cost carriers stopped service, which led American Airlines to increase its price.
_ Why do you think a lawsuit was filed against American Airlines? 
_ Why do you think American Airlines prevailed at trial?