Hyperion Inc., currently sells its latest high-speed color printer, the Hyper 500, for $369. Its cost of goods sold for the Hyper 500 is $211 per unit, and this year's sales (at the current price of $369) are expected to be 25,000 units. Hyperion plans to lower the price of the Hyper 500 to $316 one year from now.

a. Suppose Hyperion considers dropping the price to $316 immediately, (rather than waiting one year). By doing so, it expects to increase this year's sales by 22% to 30,500

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

$79 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 63% on ink cartridges. What is the incremental impact on EBIT for the next three years of dropping the price immediately (rather than waiting one year)?

a. Suppose Hyperion considers dropping the price to $316 immediately, (rather than waiting one year). By doing so, it expects to increase this year's sales by 22% to 30,500 units. What would be the incremental impact on this year's EBIT of such a price drop?

The change in EBIT will be $ (Round to the nearest dollar.)

b. Suppose that for each printer sold, Hyperion expects additional sales of

$79 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 63% on ink cartridges. What is the incremental impact on EBIT for the next three years of dropping the price immediately (rather than waiting one year)?

The change in EBIT from ink cartridge sales will be

$ (Round to the nearest dollar.)

The incremental change in EBIT for the first year is

$ (Round to the nearest dollar.)

The incremental change in EBIT for the second year is

$ (Round to the nearest dollar.)

The incremental change in EBIT for the third year is

$ (Round to the nearest dollar.)