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What is dell total profit in dollar

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Dell is selling 20,000 units in Europe at an average price of €1,700 per unit. Both the spot and forward exchange rates are $1.20/€. The cost of each unit in dollars is $1,500 per unit. The elasticity of demand for Dell computers in Europe is ε = 1.5.

Question 1: Reconsider a depreciation of Euro (relative to US Dollar ) from $1.20/euro to $1.08/euro. Now assume passthrough=0.5. what is dell's total profit in $?

Option 1: $11,869,440

Option 2: $12,028,410

Option 3: $8,028,860

Option 4: $6,397,440

Reference no: EM132592084

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