2.

If you were in Dell Havasis position, would you accept or reject the new product line?

	Accept
	Reject

3.

Why do you suppose headquarters is anxious for the Office Products Division to add the new product line?

	Adding the new line would Increase the company's overall ROI.
	Adding the new line would Decrease the company's overall ROI.

4.	Suppose that the companys minimum required rate of return on operating assets is 12.00% and that performance is evaluated using residual income.

a.

Compute the Office Products Divisions residual income for the most recent year; also compute the residual income as it would appear if the new product line is added. (Enter your Minimum Required Rate as a whole percentage (i.e., 0.12 should be entered as 12).)

b.

Under these circumstances, if you were in Dell Havasis position, would you accept or reject the new product line?

	Accept
	Reject