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The Lockheed Airline System Simulation is discussed as a step-by- step evaluation of the economics of different ways of routing passenger travel demand. Interacting items that are discussed include forecast passenger traffic demand, persistence of demand, purpose of travel, passenger preferences toward fare and speed, aircraft characteristics, flight frequency, route interaction, and competitive and regulatory influences. Also discussed are specific uses of the simulation program during the design of the supersonic transport. The first use is in determining the optimum SIST size, speed and sonic boom characteristics. The impact of a refined SST on the air transport environment is then discussed. This latter subject is presented in terms of airplane requirements, load factors, airline earnings and airline return on investment. [ABSTRACT FROM AUTHOR]

Focuses on the move of the author to compute and analyze rate of return. Claim of the author on the lack of attention given to the rate of return; Role of rate of return as basis of determining changed needs of investor and consumer; Use of any rate of return as payment for three services: interest, assumption of risk, and the cost of raising capital; Emphasis of the author of the desirability of a flexible rate of return.