Which of the following is considered an unacceptable incentive under FAA guidelines?

Cash subsidies to airlines are viewed as unacceptable incentives under FAA guidelines because they can distort fair competition in the aviation market. These subsidies may create an uneven playing field where certain airlines receive financial support that enables them to offer lower fares than their competition, ultimately leading to potential monopolistic behavior or unfair practices.

By providing cash subsidies, an airport may inadvertently undermine the market dynamics that allow for diverse airline offerings and competitive pricing. The FAA emphasizes maintaining a fair competitive environment, where all airlines operate under similar financial constraints without unfair advantages created through subsidies. This practice is aimed at ensuring that air transportation remains equitable and accessible to all users and providers.

In contrast, the other options listed can be acceptable under certain circumstances when they align with promoting air service and economic development while adhering to the FAA’s policies on fair competition.