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Use the Information for the Question(s) Below

question 2

Multiple Choice

Use the information for the question(s) below.
Glucose Scan Incorporated (GSI) currently sells its latest glucose monitor, the Glucoscan 3000, to diabetic patients for $129. GSI plans on lowering their price next year to $99 per unit. The cost of goods sold for each Glucoscan unit is $50, and GSI expects to sell 100,000 units over the next year.
-Suppose that if GSI drops the price on the Glucoscan 3000 immediately,it can increase sales over the next year by 30% to 130,000 units.Also suppose that for each Glucoscan monitor sold,GSI expects additional sales of $100 per year on glucose testing strips and these strips have a gross profit margin of 75%.Considering the increase in the sale of testing strips,the incremental impact of this price drop on the firms EBIT is closest to:

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Definitions:

Publicly Owned Treatment Works

Facilities owned by a state or municipality that are designed to treat municipal sewage or industrial wastewater.

Ocean Dumping

The disposal of waste materials directly into the ocean, often regulated to prevent environmental harm.

Marine Protection, Research, and Sanctuaries Act

United States legislation focused on the preservation and management of marine environments, often referred to as the Ocean Dumping Act.

Clean Water Act

U.S. federal law aimed at reducing pollution and protecting the quality of the nation's waterways.