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Technology Stocks : Dell Technologies Inc.

DELL 133.20

+5.7%

3:59 PM EST

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To: Jim Patterson who wrote (35081)	3/21/1998 3:15:00 PM
From: ratan lal	Read Replies (1) of 176387

Jim You know $500 profit on 2300 is a greater margin than $500 on 2500. Please show me evidence that DELL realises increased margins every time INTC cuts prices, or any other component for that matter. You have answered your own question. If INTC drops prices and DELL passes on all the reduction then presumably the price of the system will fall ($2300 in your example from $2500). The profit remains at $500. So the 'MARGIN' increases. Now if the sales increase (greater by 2500/2300) and the "MARGIN' has increased then overall $$ profit also increases. Finally evn if total sales $$ (not # of units)remain the same, margin increases, then $$ profit will also increase. I hope this is as confusing to you as it is to me. ratan

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