Example 3: Sun and Sports (Pty) Ltd. is a market leader in the selling of stay-and-play packages to local tourists. Each package, priced at R1 200 per guest, offers the buyer two nights accommodation at the Resorts and Sports Hotel, and two rounds of golf at the resort golf course. For the first time ever, Sun and Sports (Pty) Ltd. has been approached by an overseas tourist group with 50 members that are interested in staying and playing golf at the resort. The group has indicated that it has also approached similar resorts in South Africa and will base their decision about where to stay on the best (lowest) price offered. Other information Sun and Sports (Pty) Ltd. has 100 single rooms and 50 double rooms. For the weekend that the overseas tourist group wants to come and visit, the resort has received local bookings for all 50 double rooms (two guests per room) and 60 of the single rooms. The tourist group requires single rooms for all its members. The variable cost of a round of golf for the resort is R50 (caddy fee included in the package) and the cost of breakfast per guest (which is also included in the package) is R30. Greens and fairways of the golf course are maintained at a cost of R100 000 per month. The resort has ten housekeeping employees who can each service 15 rooms (single or double) per day. The salary of each housekeeper amounts to R9 000 per month. REQUIRED Calculate the minimum price that the company should ask per member of the overseas tourist group. Explain the exclusion of any costs. You may assume that local bookings may be cancelled by Sun and Sports (ignore possible penalty costs involved in the cancellations)