Question
Hyperion, Inc., currently sells its latest high-speed color printer, the Hyper 500, for $ 344 . It plans to lower the price to $ 300
Hyperion, Inc., currently sells its latest high-speed color printer, the Hyper 500, for $ 344 . It plans to lower the price to $ 300 next year. Its cost of goods sold for the Hyper 500 is $ 204 per unit, and this year's sales (at the current price of $ 344 ) are expected to be 21 comma 200 units. a. Suppose that if Hyperion drops the price to $ 300 immediately (rather than waiting one year), it can increase this year's sales by 26 % to 26 comma 712 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 $ 64 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 62 % on ink cartridges. What is the incremental impact on EBIT for the next three years of such a price drop? Question content area bottom Part 1 a. Suppose that if Hyperion drops the price to $ 300 immediately (rather than waiting one year) it can increase this year's sales by 26 % to 26 comma 712 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 $enter your response here . (Round to the nearest dollar. Enter a decrease as a negative number.) Part 2 b. Suppose that for each printer sold, Hyperion expects additional sales of $ 64 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 62 % on ink cartridges. What is the incremental impact on EBIT for the next three years of such a price drop? The change in EBIT from ink cartridge sales will be $enter your response here . (Round to the nearest dollar. Enter a decrease as a negative number.) Part 3 The change in EBIT year 1 is $enter your response here . (Round to the nearest dollar. Enter a decrease as a negative number.) Part 4 The change in EBIT for year 2 is $enter your response here . (Round to the nearest dollar. Enter a decrease as a negative number.) Part 5 The change in EBIT for year 3 is $enter your response here . (Round to the nearest dollar. Enter a decrease as a negative number.)
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