Priceline provides travel services on the Internet. 2011 was an important year for Priceline as it reported positive operating income after 3 years of operating losses. In the first quarter of 2010, Priceline reported an operating loss of $15 million on sales revenue of $62 million. In the first quarter of 2011, sales revenue had more than doubled to $129 million, and Priceline had operating income of $36 million. Assume that fixed costs were the same in 2011 as in 2010. Requirements 1. Compute the operating expenses for Priceline in the first quarter of 2010 and in the first quarter of 2011. 2. Determine the cost function for Priceline, that is, the total fixed cost and the variable cost as a percentage of sales revenue. 3. Explain how Priceline's operating income could increase by $51 million with an increase in sales of $67 million, while it had an operating loss of $15 million on its $62 million of sales in the first quarter of 2010. Requirement 1. Compute the operating expenses for Priceline in the first quarter of 2010 and in the first quarter of 2011. 2010 2011 million million Less million million Operating expenses million million