sorry for bad image, plaese zoom in :)

Apple has been selling 54, 000 iMacs per year at a price of $4, 150 and an operating margin of 67% (1.e. what fraction of revenue is left after deducting COGS and depreciation) for years and expects to continue doing so. Next year (year 1), Apple will introduce the new model but keep the old model on the market. Total sales will stay flat, but Apple expects that in each of the next 3 years, the old model will lose one third of its market share to the new model so that in year 3 and after all sales will be due to the new model. In order to achieve this orderly decline in sales of the old model, the old model price will be reduced to $3,735, while the new model will be introduced at the current price and operating margin. The operating margin of the old model falls to 53 %. What is the incremental impact on EBIT in year 1 from the gradual transition in models (in million, 3 decimal places)? $ What in year 2 (in million)? S What in year 3 (in million)? Apple designed the new model in such a way that customers who buy the new model in one year can be expected to contribute $244 in extra EBIT in the form of software and hardware upgrades per unit for each of the 3 subsequent years. The old model effects no such add-on purchases. What will be the incremental effect on year 2 EBIT that is due to the add-on sales only (in million)? S What in year 3 (in million)? $ m What in year 4 (in million)