Discussion
Direct operating cost typically excludes
Answer: B
Correct answer: Administration and marketing
Direct operating cost covers what it takes to fly the aircraft - fuel, flight and cabin crew, maintenance, depreciation, insurance and landing and navigation fees. Administration and marketing are indirect, supporting the airline as a business rather than any particular flight.
The distinction matters because direct operating cost is the figure used to compare aircraft types: it isolates what the aeroplane costs to operate from what the airline costs to run, so two carriers with very different overheads can still compare the same aircraft on a common basis.
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