Question $1$

$20$ pts

Expedia sells packaged holidays from Toronto to Mexico and books passengers a seat on Canada Air. Expedia's fixed costs are $$14,000$ per month, and Canada Air charges passengers $$600$ round$-$trip tickets.

Calculate the number of tickets Expedia must sell each month $($a$)$ to breakeven and $($b$)$ make a targeted operating income of $$7,000$ per month in each indicated case.

Expedia's variable costs are $$45$ per ticket, and Canada Air Cruises pays Expedia a $10\%$ commission on the ticket price. $(5$ marks$)$

Expedia's variable costs are $$34$ per ticket, and Canada Air Cruises pays Expedia a $10\%$ commission on the ticket price. $(5$ marks$)$

Expedia's variable costs are $$34$ per ticket. Canada Air Cruises pays Expedia a $$54$ commission on the ticket price. Comment on the results. $(5$ marks$)$

Expedia's variable costs are $$40$ per ticket. Canada Air Cruises pays Expedia a $$55$ commission on the ticket price. Comment on the results. It charges customers a delivery fee of $$15$ per ticket. The cost for Expedia to deliver the ticket is $$4$ per ticket. Comment on the result. $(5$ marks$)$

Please show formulas and computations for your answers