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Question 11 of 11 This quiz: 11 point(s) possible This question: 1 point(s) possible Submit quiz Hyperion, Inc., currently sells its latest high-speed color printer,
Question 11 of 11 This quiz: 11 point(s) possible This question: 1 point(s) possible Submit quiz Hyperion, Inc., currently sells its latest high-speed color printer, the Hyper 500, for $358. It plans to lower the price to $305 next year. Its cost of goods sold for the Hyper 500 is $210 per unit, and this year's sales (at the current price of $358) are expected to be 20,400 units. a. Suppose that if Hyperion drops the price to $305 immediately (rather than waiting one year), it can increase this year's sales by 27% to 25,908 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 $91 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 71% 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 $305 immediately (rather than waiting one year) it can increase this year's sales by 27% to 25,908 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.) b. Suppose that for each printer sold, Hyperion expects additional sales of $91 per year on ink cartridges for the three-year life of the printer, and Hyperion has a gross profit margin of 71% 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 $ ]. (Round to the nearest dollar. Enter a decrease as a negative number.) The change in EBIT year 1 is $|. (Round to the nearest dollar. Enter a decrease as a negative number.) The change in EBIT for year 2 is $ . (Round to the nearest dollar. Enter a decrease as a negative number.) The change in EBIT for year 3 is $ . (Round to the nearest dollar. Enter a decrease as a negative number.)
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