Hurte$-$Paroxysm Products, Inc. $($A$).$ Hurte$-$Paroxysm Products, Inc. $($HP$)$ of the United States, exports computer printers to Brazil, whose currency, the real $($R$$)$ has been trading at $R$$$\frac{3\mathrm{.}50}{U}$$$.$ Exports to Brazil are currently $40,000$ printers per year at the real equivalent of $$250$ each. A strong rumor exists that the real will be devalued to $R$$$\frac{4\mathrm{.}00}{\text{\$}}$ within two weeks by the Brazilian government. Should the devaluation take place, the real is expected to remain unchanged for another decade. Accepting this forecast as given, HP faces a pricing decision that must be made before any actual devaluation: HP may either $(1)$ maintain the same real price and in effect sell for fewer dollars, in which case Brazilian volume will not change, or $(2)$ maintain the same dollar price, raise the real price in Brazil to compensate for the devaluation, and experience a $20\%$ drop in volume. Direct costs in the United States are $60\%$ of the U$.$S$.$ sales price.

a$.$ What would be the short$-$run $($one$-$year$)$ impact of each pricing strategy?

b$.$ Which do you recommend?

a$.$ If HP maintains the same real price and same unit volume, what will be the firm's gross profits?

$($Round to the nearest dollar.$)$