Xeret Industries manufactures and sells an industrial lift that is used primarily for facility maintenance (cleaning, painting, light repair work, etc.). The company has a loyal customer base because of the quality of its product and its trade-in program. Xeret gives its customers a trade-in credit whenever they trade-in an old lift and purchase a new one. Xeret refurbishes these old lifts at a cost of $1000, and then sells them as used lifts to other customers. Xerets cost for producing a new lift is $7000. Other customers who need to purchase additional lifts will consider purchasing a new lift at the full retail price or a used lift at the lower used price. The only used lifts available for sale are those that the company obtains and refurbishes through its trade-in program. The prices and trade-in allowance that Xeret chooses to offer affect the amount of demand for its lifts and ultimately its bottom-line. The company uses the following formulas to compute projected demands: Trade-In Demand1,0000.10Retail_Price0.10Trade-In_Credit,New Retail Demand1,0000.10Retail_Price0.05Used_Price,Used Demand 0.05Retail_Price0.10Used_Price.=+=+= Xeret is planning to sell its new lifts at a retail price of $9000, to sell its used lifts at a price of $3500, and to offer a trade-in credit of $1300.

(10 points) Members of Xeret management are split on the current level of the trade-in credit; some think it is too high, while others too low. Thus, conduct an analysis related to the interaction of retail price and trade-in credit on total profit. Describe your findings in detail. (Use $100 increments in your analysis.)