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Hyperion, Inc., currently sells its latest high-speed color printer, the Hyper 500, for $341. It plans to lower the price to $296 next year. Its
Hyperion, Inc., currently sells its latest high-speed color printer, the Hyper 500, for $341. It plans to lower the price to $296 next year. Its cost of goods sold for the Hyper 500 is $198 per unit, and this year's sales (at the current price of $341) are expected to be 27,000 units a. Suppose that if Hyperion drops the price to $296 immediately (rather than waiting one year), it can increase this year's sales by 26% to 34,020 units. What would be the incremental impact on this year's EBIT of such a price drop? b. Suppose that for each printer sold, Hyperion expects additional sales of $68 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 65% on ink cartridges. What is the incremental impact on EBIT for the next three years of such a price drop? a. Suppose that if Hyperion drops the price to $296 immediately (rather than waiting one year) it can increase this year's sales by 26% to 34,020 units. What would be the incremental impact on this year's EBIT of such a price drop? The change in this year's EBIT is $ (Round to the nearest dollar Enter a decrease as a negative number)
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