Summit Outdoor Gear manufactures and sells 7 different models of outdoor gear. Summit Outdoor Gear...
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Summit Outdoor Gear manufactures and sells 7 different models of outdoor gear. Summit Outdoor Gear is contemplating a 4% price cut for all models. It expects the price cut to result in an 8% increase in units sold for models YY5101, YY5103, and YY5105. The other four models (YY5102, YY5104, YY5106, and YY5107) are expected to see a 5% increase in sales volume. Assess the impact of the price cut on Summit Outdoor Gear’s profits and prepare the equity statement. •Model: YY5101 oSales Price: $85 oVariable Costs: $40 oSales Volume: 2,000 •Model: YY5102 oSales Price: $95 oVariable Costs: $45 oSales Volume: 2,500 •Model: YY5103 oSales Price: $105 oVariable Costs: $50 oSales Volume: 3,000 •Model: YY5104 oSales Price: $115 oVariable Costs: $55 oSales Volume: 3,500 •Model: YY5105 oSales Price: $125 oVariable Costs: $60 oSales Volume: 4,000
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