As a new CEO you would like to satisfy your flying needs by best airlines “X”s fractional aircraft ownership program. You can pick 3 different plans. Under part 1, you pay a fixed cost of $5,000,000 p

  

As a new CEO you would like to satisfy your flying needs by best airlines “X”s fractional aircraft ownership program. You can pick 3 different plans. Under part 1, you pay a fixed cost of $5,000,000 per year and can use unlimited fly time. Under plan 2, you pay a fixed cost of $1,000,000 per year and you can use 40 hours of flight time for free. For each additional hour of flight (above 40 hrs) costs you $8,000 under plan 2. Under plan 3, you pay a fixed cost of $2,000,000 per year and can use 80 hours of flight time for free. For each additional hour of flight ( about 80 hrs) costs you $5,000 for plan 3.
a. Clearly write the cost functions for each example
b. Which plan would you choose if you plan to fly a total of 200 hours a year. (Compete costs under all plans)
c. How many hours should you plan to fly to choose the unlimited plan?

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