Final answer:
The short term costs of improving air travel safety after 9/11 include retrofitting cockpit doors and security equipment, with a price tag of $450 million and $2 billion, respectively. Long term costs include the yearly $3 billion for sky marshals. HighFlyer Airlines also faces costs associated with R&D for redesigned cabins to enhance passenger comfort and increase revenue.
Step-by-step explanation:
The costs associated with improving air travel safety after 9/11 can be classified into short term and long term costs. Short term costs would include the immediate expenditures such as the one-time retrofitting of cockpit doors with a total cost of $450 million, and the implementation of sophisticated security equipment with a cost of $2 billion. These are upfront costs that would be incurred fairly quickly.
In the long term, the maintenance of these security measures would continue to generate costs. For instance, having a sky marshal on every flight accounts for an ongoing cost of $3 billion per year. It illustrates a sustained financial commitment which, while substantial, is crucial for ensuring the continued safety of air passengers.
To improve passenger comfort and potentially increase revenue, HighFlyer Airlines is also considering changes that would generate additional costs. Redesigning airplane cabins to increase space involves research and development (R&D) which impacts operating costs and potentially, if effective, leads to increased ticket sales. When HighFlyer Airlines evaluates R&D projects, it considers the private rate of return to ensure that the financial benefits justify the implemented changes.