1.A subscription food delivery service, Extra Tasty, is planning to launch four precooked meal packages.They intend to hire a celebrity chef to develop the recipes offered in the four new packages: Vegan, Glu-free, MeatLove and Keto. Extra Tasty will spend $15,000 to hire a top chef to create the recipes, and $225,000 on marketing. The prices and variable costs of the meal packages are: P_Vegan= $312, VC_Vegan= $70; P_Glu-free= $280, VC_Glu-free= $62; P_MeatLove= $336, VC_MeatLove= $80; and P_Keto= $240, VC_Keto= $48. They expect to sell the packages in the ratio 4:5:7:3, respectively. The total customer base of Extra Tasty is 15,000 customers.

a.Calculate the breakeven quantity for each model.

b.Assume that customers who buy certain packages don't switch to different ones, but the probability of staying with Extra Tasty from month to month has been 75%, 82%, 68%, and 85%. Assuming a discount rate of 4% annually, calculate the CLV for customers in each meal plan segment. Use the total contribution for each meal plan from part (a) as the (annual) margin in each case, and remember to subtract the AC (which is the FC/customer base).