Printwell' s Ink Jet Division manufactures ink-jet printers and the ink cartridges they use  Sales of its ink-jet printers have increased  Monthly revenues from those sales, however, have not increased, because competition has forced Printwell to cut the prices of its printers  Unfortunately, Printwell has been unable to bring down the cost of manufacturing a printer
Thus, despite the increase in printer sales, the Ink Jet Division must be contributing less to the company' s profits than it used to
Unlike some competing companies, Printwell sells all of its printers through retailers, and these retailers' costs account for a sizable proportion of the printers' ultimate retail price.