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Video Concepts, Inc. (VCI) manufactures a line of videocassetterecorders (VCRs) that are distributed to large retailers. The lineconsists of three models of VCRs. The following data are availableregarding the models:ModelVCR Selling Price per UnitVariable Cost per UnitDemand/Year (units)Model LX1$175$1002,000Model LX2$250$1251,000Model LX3$300$140500VCI is considering the addition of a fourth model to its line ofVCRs:This model would be sold to retailers for $375.The variable cost of this unit is $225.The demand for the new Model LX4 is estimated to be 300 unitsper year.Sixty percent of these unit sales of the new model is expectedto come from other models already being manufactured by VCI:20 percent from Model LX130 percent from Model LX250 percent from Model LX3.VCI will incur a fixed cost of $20,000 to add the new model tothe line.Answer the following:Based on the preceding data, should VCI add the new Model LX4to its line of VCRs? Why?Make sure you are responding to each part of everyquestion. You do not have to show your work for eachquestion, but I recommend it because partial credit will begiven for completing the right steps even if your finalanswer is incorrect.