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Technology Stocks : Hewlett-Packard (HPQ)

HPQ 19.80

+4.1%

12:43 PM EST

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To: Jerome who wrote (76)	5/7/2002 10:12:19 AM
From: MeDroogies	of 4345

The volume equation is not 1 to 1. Volume is dependent on price elasticity. Selling 1mm units at $1 is better than selling 700k at $1.20 ($1mm versus $840k). Costs to create 1mm units are lower, and the 18% discount is beneficial to the consumer. There is no indication that HWP's losses in the PC sector were a result of volume issues. CPQ's losses (or reduced revs) there were. CPQ had(s) the infrastructure in place to crank out the machines. Dell's model isn't as good as people think. They have a ridiculously high return rate and very high backend costs. I purchased a refurbished Dell for my wife last Christmas. Worst mistake I ever made. I did it on the suggestion of my IP guy at work. It was a great deal, money-wise. Based on the amount of time I've spent on the phone, or rebooting it after it crashed....it's a money loser.

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