Different Approach

Airport taxi
New answer on Dec 31, 2019
3 Answers
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Anonymous A asked on Dec 30, 2019

Would it have been wrong to take a different approach with calculating the revenues?

The approach I took was, I tried to calculate the total daily revenue through calculating the revenues from the night and day shift separately.

Firstly,

no. passengers per day = (airport passengers) * (percentage of passengers using taxi)/ (days in a year)

= 84M*20%/350

= 48,000 passengers

That means,

daytime shift = (total taxis used in day) * dayfare

= (no. of passengers per day * % of day passengers)/passengers/taxi * dayfare

assuming on average a taxi is shared between 2 passengers

= (48,000* 50%)/2 * 70

= 840,000

Night shift = (total taxis used at night) * dayfare

= (no. of passengers per day * % of night passengers)/passengers/taxi * dayfare

assuming on average a taxi is shared between 2 passengers

= (48,000* 50%)/2 * 80

= 960,000

Total Daily Revenues = 840,000+960,000 =1.8M

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Antonello
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replied on Dec 31, 2019
McKinsey | MBA professor for consulting interviews

Hi,
I confirm it is correct and maybe more intuitive. However, the proposed one is preferable in terms of speed.

Best,
Antonello

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Clara
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replied on Dec 31, 2019
McKinsey | Awarded professor at Master in Management @ IE | MBA at MIT |+180 students coached | Integrated FIT Guide aut

Hello!

Altough it works, simplicity is also something to be valued (in terms of shortest time to calculations, less options to fall in pitfalls, etc.)

Hence, unless you don´t understand the other one, I would go with it.

Hope it helps! Cheers,

Clara

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Luca
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replied on Dec 31, 2019
BCG |NASA |20+ interviews with 100% success rate| 120+ students coached |GMAT expert 780/800 score

Hello,

Your approach sounds fine but I think it's more complex than the one proposed in the solution, I would keep the solution proposed.

Best,
Luca

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Antonello gave the best answer

Antonello

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McKinsey | MBA professor for consulting interviews
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