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You just quit your job to start a company revolutionizing the toilet paper product category. Youare starting a new subscription service for toilet paper. The

You just quit your job to start a company revolutionizing the toilet paper product category. Youare starting a new subscription service for toilet paper. The subscription service will ship toiletpaper monthly to customers and will mostly consist of regular toilet paper, but will alwaysinclude a couple of surprise and delight rolls.Customers will pay $15 per month, but you onlycollect the payments at the end of a subscription year. Customers have to sign up for at least ayear and the subscription renews every year unless the customer cancels. The cost of serving acustomer is $100 per year (includes all variable costs) a)You estimate that every year 30% of subscribers will cancel their subscription. What isthe maximum amount you would pay for acquiring a customer if you want to break evenafter 3 years of service? (Do not apply any discounting for this initial calculation.)

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