The American Airlines AAdvantage (“Advantage”) Rewards program is the 1st and world’s largest frequent flyer program, or so their website claims. Travelers earn miles when they fly on American Airlines, American Connection/Eagle, or more than 20 other airline partners. The American Airlines Advantage program offers several different types of awards:
In order to calculate the value of certain frequent flyer programs, it is necessary to understand what it would cost to buy those airline tickets with cold hard cash. In economic terms, I think this is referred to as the replacement cost. Given that airline pricing strategy is one of the more complex human endeavors (witness the armies of economics PhDs hired by airlines to tackle this stuff!), we aren’t aiming for anything near perfection here, just a directional estimate.
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