Please answer all the questions with clear steps as mentioned in the guideline

The intent of this assignment is to get you to do some common calculations you will encounter in marketing. One of those calculations is that of finding the breakeven sales, i.e., the minimum sales needed to cover all costs (the point at which there is no profit or no loss). 1. Read the case that follows and answer the questions that are provided at the end of the case. 2. Number each of your answers and make sure they are in exactly the same order as the questions that are at the end of the case. 3. Show your detailed calculations. Simply providing the final answer is not good enough and will not earn any marks, even if the answer is correct. You need to show the step-by-step calculations by which you arrived at the final answer. For instance, just a Yes or No answer to Question 2 will not earn any marks if the calculations to back up your answer are not shown. 4. Right answers but with the wrong logic used for calculations will not earn any marks. However, if the calculation logic is correct, you will earn some marks even if the final answer is incorrect. 5. Each question carries 2.5 marks. L.ife Cruises, Inc., packages cruises to Caribhean is- few more that will trickle in over the next month: or lands such as Martinique and the Bahamas, Like conven- (3) we shell out some more money on advertising and tional eruises, the packages are designed to be fun. But hope that we can pull in more people. the cruise is structured to help participants become "My recommendation to this board is that we try to healthice by breaking old habits, such as smoking of over- recruit more passengers. There are simply too many cating. The Miami-based firm was conceived by Susan empty rooms on that ship. Every empty room is an Isom, 30, a self-styled innovator and entreprencur. Prior opportunity loss and costs us a bundle." to this venture, she had spent several years in North At this point, Carolyn Sakhan addressed the board: Carolina promoting a behavior-modification clinic, "I've worked out two possible advertising campaigns for Isom determined that many people were very concemed the November 20 papers. The first, the limited camabout developing good healh habits, yet they seemed unable to paign, will cost $12,000. I estimate that it will bring in break away from their old habits because of the pressures of some 20 passengers. The more ambitious campaign. day-10-day living. She reasoned that they might have a which I personally recommend, would cost $30,000. I chance for much greater suceess in a pleasant and socially believe this campaign will bring in a mainimum of 40 supportive environment, where good health habits were passengers. fostered. Accordingly, she established Life Cruises, "/ realize that our first attempt was somewhat disapInc., hired 10 consulting psychologists and health specialists to pointing. But we're dealing here with a new concept, and a develop a program, and ehartered a ship. DeForrest follow-tip ad might work with many newspaper readers who Young. a Miami management consultant, became the were curious and interested when they read our first notice. chaimerson of Life Cruises. Seven of Isom's business "One thing is absolutely certain," Sukhan emphasized. associates contributed an initial outlay totaling over half "We must act immediately if there's any hope of getting a milion in sunk (non-refundable) costs, Of this amount, more people on board. The deadline for the Sunday pa- S130,000 went for the advertixing budeet, $20,000 for other pers is in less than 48 hours. And if our ads don't appear by S130,000 went for the advertising budget, $20,000 for other pers is in less than 48 hourx. And if our ads don't appear by administrative expenses, and 5440,000 for the shin rental and this weekend, you can forget it. No one signs up in early date, the Pittsford and LaRue Advertixing Agency placed to be able to justify it." promotional notices for the cruise in several major metropolitan newspapers. Mary was fascinated by the idea of combining therapy sessions with swimming, movies, and Questions an elegant atmosphere. Pittsford and LaRue account executive Carolyn 1) What is the minimum number of passengers that Sukhan originally estimated that 300 people would sign Life Cruises must sign up by November 20 to break up for the cruise after reading the October 16 ads. But as of even with the cruise? November 14, only 200 had done so. Isom and Life Cruises, Inc., faced an important decision. "Here's the situation as I see it." explained a disturbed 200 passengers had signed up as of November 14 ? Isom at the Life Cruises board meeting. "We've al- 3) Would it be worthwhile for Life Cruises to spend ready paid out more than a half a million to get this cruise either $12,000 or $30,000 for advertising on passenger, mostly for food and other supplies during the November 20 ? If so, which figure would you three-day craise. Pittsford and LaRue predicted that 300 recommend? people would respond to the advertising campaign, but 4) Susan Isom wishes to make $1 million in profits weveonlygot200."Tseethreebasicoptions:(1)wecancelthecruiseandcosts,passengerfare,andshipcapacityasthemaidenfromcachcruisevoyage.Assumingthesamefixed take our losses; (2) we run the cruise with the 200 and a voyage, is her wish a realistic one