What qualitative factors would have influenced the Patriots aircraft decision? What costs would be relevant...
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What qualitative factors would have influenced the Patriots aircraft decision?
What costs would be relevant to the pricing decision for renting the planes when not in use by the team?
Do you think aircraft depreciation is a relevant cost to consider when pricing the rental of the Patriots aircraft? Why or why not?
What capital budgeting tools could the Patriots have used to analyze this aircraft purchase decision?
The New England Patriots recently became the first National Football League (NFL) franchise to buy its own team aircraft. The Patriots purchased two Boeing 767 planes for a total of about $10 million. Both planes have been painted with the team's logo and colors. The Patriots will use the planes for the ten round trips for its away games during the 2017 - 2018 season. If the team would make the playoffs or Super Bowl, it would also use the planes for those games. If a franchise does not own its own planes, the costs of chartering planes is estimated to be about $4 million for the season. The Patriots management has indicated that it may rent out the planes when not in use by the team
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