| Course | AVF-4740 Airport Management II |
|---|---|
| Module | Module 6 |
| Paper type | Written Assignment 3: airport financial management |
| Length | About 630 words, 5 pages |
| Format | APA 7 student paper |
| School | Thomas Edison State University |
| Program | B.S.B.A. in Aviation Management |
| Updated | October 2026 |
Free sample paper for AVF 4740 Module 6
Six Dollars and Eighty-Six Cents per Thousand Pounds: Setting Rates and Charges at Cumberland Bay Regional
Student Name
B.S.B.A. in Aviation Management, Thomas Edison State University
AVF-4740: Airport Management II
Mentor Name
Month Day, Year
Six Dollars and Eighty-Six Cents per Thousand Pounds: Setting Rates and Charges at Cumberland Bay Regional
Introduction
Airports must be as self-sustaining as possible under their federal grant assurances, yet they also compete for airlines that compare costs across airports. Rates and charges are where those goals meet. This paper sets Cumberland Bay Regional's main airline charges and asks whether they help or hurt its air service goals. All figures are illustrative.
Cost Centers and the Budget
Prather and Steele (2015) explain that airports divide their budgets into cost centers, such as the airfield, the terminal, parking and ground transportation, general aviation and other leased areas. Each cost center collects its share of operating expenses, debt service and capital costs, including a fair share of administration. The cost center's revenue requirement is the amount it must recover.
| Cost center | Revenue requirement (illustrative) |
|---|---|
| Airfield | $2,400,000 |
| Terminal | $3,000,000 |
| Parking and ground transportation | $900,000 |
| General aviation | $700,000 |
Setting the Landing Fee
Under a compensatory method, the airfield requirement is divided by the landed weight of aircraft that use the airfield. If aircraft land 350 million pounds a year, measured in units of 1,000 pounds, that is 350,000 units. The landing fee is $2,400,000 divided by 350,000, or about $6.86 per 1,000 pounds of landed weight. An aircraft with a maximum landing weight of 145,000 pounds would pay about $995 per landing.
Setting the Terminal Rent
The terminal requirement is divided by the rentable space in the terminal. With 50,000 rentable square feet, the rate is $3,000,000 divided by 50,000, or $60 per square foot per year. Airlines, concessions and rental car companies pay this rate for the space they lease. Public areas such as corridors and restrooms are not rentable, so their cost is spread across rentable space.
Cost per Enplanement
Airlines compare airports using cost per enplanement (CPE): the total the airlines pay the airport divided by the number of boarding passengers. Suppose airlines account for 80 percent of landed weight, paying about $1,920,000 in landing fees, and lease 25,000 square feet of terminal space, paying $1,500,000. Their total is $3,420,000. With 300,000 boarding passengers, CPE is about $11.40.
| Item | Amount |
|---|---|
| Airline landing fees | $1,920,000 |
| Airline terminal rent | $1,500,000 |
| Total airline payments | $3,420,000 |
| Boarding passengers | 300,000 |
| Cost per enplanement | About $11.40 |
Is the CPE Competitive?
A new leisure airline weighing Cumberland Bay Regional against other small airports will look at CPE alongside expected fares and demand. A CPE around $11 is not extreme for a small airport, but an airline with thin margins may still prefer an airport with lower charges. Because the airport uses a compensatory approach, it keeps the parking surplus. Wells and Young (2011) note that airports can use such revenue to fund air service incentives within federal rules, and Graham (2009) shows how heavily airports have come to rely on commercial income of this kind. A temporary waiver of landing fees for new routes, offered to any airline on the same terms, would lower a new carrier's first-year cost without changing the rates other airlines pay.
Balancing Self-Sufficiency and Growth
Raising rates would make the airport more self-sufficient but could drive airlines away; lowering them below cost would require subsidies the county cannot afford and could conflict with grant assurances. The compensatory method, combined with non-airline revenue from parking, concessions and land, lets the airport keep rates at cost while still funding incentives.
Conclusion
Rates and charges turn an airport's budget into the prices airlines pay. At Cumberland Bay Regional, illustrative figures give a landing fee of about $6.86 per 1,000 pounds, a terminal rent of $60 per square foot and a CPE of about $11.40. The airport's financial task is to keep those rates fair and at cost while using non-airline revenue to attract and keep service.
References
Graham, A. (2009). How important are commercial revenues to today's airports? Journal of Air Transport Management, 15(3), 106-111. https://doi.org/10.1016/j.jairtraman.2008.11.004
Prather, C. D., & Steele, R. N. (2015). Airport management. Aviation Supplies & Academics.
Wells, A. T., & Young, S. B. (2011). Airport planning and management (6th ed.). McGraw-Hill.
AVF 4740 Module 6 instructions, in plain terms
AVF-4740's third written assignment goes with Module 6, Financial Management, which covers the ninth, tenth and eleventh course objectives, and it asks how an airport manages its budget, sets rates and charges and copes with financial pressure. A worked example, using real figures from an airport's budget or illustrative ones clearly labeled, shows that you understand how a landing fee or terminal rent is built. Cost per enplanement is the measure airlines use to compare airports, so including it connects finance to air service. Since the final project weighs the airport's finances, this paper feeds it directly. Label every illustrative figure clearly, and show the units, such as dollars per 1,000 pounds or per square foot.
Inside the AVF 4740 Module 6 example
The sample opens with the tension between self-sufficiency and competing for airlines. A section explains cost centers and revenue requirements, with a four-row table of illustrative figures. The landing fee is calculated at about $6.86 per 1,000 pounds and applied to one aircraft, and the terminal rent at $60 per square foot. A cost per enplanement calculation reaches about $11.40, shown in a five-row table; its margin note explains the value of showing each step. The paper then judges whether that cost is competitive, cites Graham's research on commercial revenue and closes by weighing self-sufficiency against growth. The tables show each step of the calculation so a reader can check the arithmetic.
AVF 4740 Module 6 rubric: what earns full marks
Mentors reward accurate explanation of airport financial concepts, correct calculations and sound judgment about what the numbers mean. A paper that shows each step from cost center to rate to cost per enplanement, with labeled figures, demonstrates understanding that a description of airport finance cannot. Linking rates to air service goals and grant assurance obligations shows management thinking. Clear tables, correct terms such as landed weight and rentable space, and a reference list with the textbook and a research article complete what this written assignment needs. Interpreting the cost per enplanement against what an airline would accept shows the link between finance and air service that the module stresses.
AVF 4740 Module 6 help from the desk
Common errors include dividing landing costs by the number of flights instead of landed weight, mixing up the airport's total budget with the airline share or presenting illustrative figures as an airport's real ones. Others compute rates without saying what they mean for airlines. Show each step, label the units, check the arithmetic and interpret the result against what airlines would accept. Mention how non-airline revenue fits. Keep the tables small. AVF-4740 students can get a first rates and charges sample on their own airport free. Recheck each division before submitting, and compare your result with published figures for similar airports if you can find them, since a single arithmetic slip carries through every later figure.
Write yours, or have the desk draft it
This paper is an original model document written by our desk, not a submitted student paper and not an official Thomas Edison State University document. Read it for the moves, then write your own to the instructions in your classroom. If you want one built to your exact prompt and rubric, the first custom sample is free and arrives in 24 to 48 hours.
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AVF 4740 Module 6 questions, answered
Where can I find a free AVF 4740 Module 6 sample paper?
The paper above calculates a landing fee, a terminal rent and cost per enplanement for a composite county airport.
How is an airport landing fee calculated?
Under a compensatory method, the airfield cost center's revenue requirement is divided by total landed weight, usually per 1,000 pounds.
What is cost per enplanement?
The total amount airlines pay an airport divided by the number of boarding passengers, used to compare airline costs across airports.
What is an airport cost center?
A part of the airport, such as the airfield or terminal, to which expenses and revenues are assigned so rates can be set for each.
What is the AVF-4740 final project?
A study of how stakeholders function in the airport system, assessing the airport's financial attributes and planning phases and building on the blog entries.