4.IntercontactINC. is a young and successful Southern California-based company. It manufactures highly sophisticated components that are used in both fixed line and cellular telephony. The relevant basic data on costs and market conditions for its ICX switch in the U.S. are the following (these data refer to a batch consisting of 10,000 units of the ICX):   i) Incremental (or marginal) costs of producing, shipping and selling an additional batch is equal to$75,000. ii) Fixed annual costs (production, marketing, administrative and so on): $30,000,000. iii) Past experience has shown that the U.S.market for this type of switch is quite sensitive to price changes. After seriously researching the issue, the company’s marketing department has concluded that if the price increases (decreases) by 1%, sales will decline (increase) by 2%. Detailed and careful statistical and technical analyses have confirmed that in the U.S. the company faces a price elasticity of demand equal to –2.   In the U.S. the company charges $120,000 per batch, and last year total sales amounted to 4,000 batches. Last year total revenues were $480 million and total costs were $330 million.   a)Review the pricing model(s) being used in the US. What can you find out –is the firm setting the optimal price and output level?   b)What additional type of information would you like to have in order to undertake a more complete analysis?