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Sports Gear Pro manufactures and sells 9 different models of sports equipment. Sports Gear Pro is contemplating a 6% price cut across all 9 models.

Sports Gear Pro manufactures and sells 9 different models of sports equipment. Sports Gear Pro is contemplating a 6% price cut across all 9 models. It expects the price cut to result in an 8% increase in the number of units sold for models SS4501, SS4503, and SS4505. The other six models (SS4502, SS4504, SS4506, SS4507, SS4508, and SS4509) are expected to see a 5% increase in sales volume. Assess the impact of the price cut on Sports Gear Pro’s profits.

Model

Sales Price

Variable Costs

Sales Volume

SS4501

$70

$35

1,800

SS4502

$80

$40

2,000

SS4503

$90

$45

2,500

SS4504

$100

$50

3,000

SS4505

$110

$55

3,500

SS4506

$120

$60

4,000

SS4507

$130

$65

4,500

SS4508

$140

$70

5,000

SS4509

$150

$75

5,500

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