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Hyperion Limited currently sells its latest high-speed colour printer, the Hyper 500, for $332. It plans to lower the price to $285 next year. Its
Hyperion Limited currently sells its latest high-speed colour printer, the Hyper 500, for $332. It plans to lower the price to $285 next year. Its cost of goods sold for the Hyper 500 is $190 per unit, and this year's sales are expected to be 16 000 units. a. Suppose that if Hyperion drops the price to $285 immediately, it can increase this year's sales by 25% to 20 000 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 next three years, and Hyperion has a gross profit margin of 78% on ink cartridges. What is the incremental impact on EBIT for the next three years of a price drop this year? a. Suppose that if Hyperion drops the price to $285 immediately, it can increase this year's sales by 25% to 20 000 units. What would be the incremental impact on this year's EBIT of such a price drop? The change in EBIT will be $ 1. (Round to the nearest dollar.) b. Suppose that for each printer sold, Hyperion expects additional sales of $79 per year on ink cartridges the next three years, and Hyperion has a gross profit margin of 78% on ink cartridges. What is the incremental impact on EBIT for the next three years of a price drop this year? The change in EBIT from ink cartridge sales will be $ 1. (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.)
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