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Does the management fee rise as hours purchased increases?

April 26, 2017fee hours increases Management Rise

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Does the management fee rise as hours purchased increases?

1 Answer

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Yes, the management fee increases with the size of share purchased and is a pro-rata share of fixed cost. Examples include hangar, administrative cost, insurance and training. This is a disadvantage to the fractional at high aircraft utilization rates and an advantage at low utilization rates.