Question 1 Prospects is a graduate career guidance software package which has a six year product lifecycle. The following are the yearly costs, estimated for the entire length of the package's life: Yr1 Yr2 Costs in '000 Yr3 Yr4 Yr5 Yr6 230 Research & development Design 180 110 Production 200 200 40 95 140 130 60 Marketing Distribution 20 15 10 5 5 15 30 45 Customer service 160 80 120 60 Units produced and sold (000) You are required to: a). Calculate the minimum price per unit that should be charged during the launch phase up to Yr3, ensuring all costs are covered. (2 marks) b). Calculate the minimum price per unit that should be charged during the whole lifecycle of the product, in order to ensure that all costs are covered. (4 marks) c). The company has carried out market research and has determined that the maximum price at which the software could be sold in its first year of sales is 14 per unit. The company's policy is to make at least a gross margin of 50% on its selling price, using the absorption costing basis. Explain what this means for the company with regard to its