explain steps by steps.

9W1 Variance Associates (VA) is a commercial aircraft leasing firm. It has two customers. FearUs and Oops. both of which are major overnight package delivery companies. Airlines and overnight package companies normatiy own only a portion of their total eet of aircraft. and lease the balance on an asneeded basis. FearUs and Oops have long-term contracts with VA. under which they have the option to request planes from VA on a monthly basis. The current situation is as follows: a Each month FearUs can request up to 4 planes for the following month, at a price of 150 000 per month for each piane requested. - Oops can also request up to 4 planes for the succeeding month. at a price of 150 ODD/plane per month. a VA owns 8 planes. in order to cover its contracts. It has had both good and bad years in the past. but cumulatively it is just breaking even. Out of frustration. the president of VA hires a consultant. The Consulting Company assigns a consuitant to assess the problem and deliver a solution. The president of VA explains: . VA has great margins on its leased planes. but the firm's total performance has been uneven. 0 VA has fixed costs of 75.000/plane per month (i.e.. whether or not the plane was leased that month). but all other costs incurred when a plane is in service (e.g.. fuel. maintenance. crews) are covered by the customer at the customer's expense. VA's data on the demand for planes by each customer is given in the following probability distribution table derived: FearUs Demand ' E-I-E-E-l-I_I-E-E-I- Probabili [Emma-unimmmmm (a) Determine the expected number of planes to be on the ground at VA each month. [4 marks] (b) Determine the expected cash flow each month under VA's current business policies. [4 marks] (0) Suppose that to improve VA's profitability. a new. twotier strategy is proposed: I Sell off one plane. and keep only 7 to meet demand. - To satisfy the customers. offer a new policy. if a customer ever asks for a plane and VA does not have one, VA will pay the customer 150,000. Determine expected profits under the new strategy assuming that the demands for Oops and FearUs are independent. [8 marks] (d) Determine the effect on VA's revenue if it downsizes to only four (4) planes. [4 marks]