Question
A company has a process that results in 14000 pounds of Product A that can be sold for $8 per pound. An alternative would be
A company has a process that results in 14000 pounds of Product A that can be sold for $8 per pound. An alternative would be to process Product A further at a cost of $93800 and then sell it for $14 per pound. Should management sell Product A now or should Product A be processed further and then sold? What is the effect of the action?
a. Sell now, the company will be better off by $9800.
b. Process further, the company will be better off by $84000.
c. Sell now, the company will be better off by $93800.
d. Process further, the company will be better off by $9800
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