Question
A company has a process that results in 15000 pounds of Product A that can be sold for $8 per pound. An alternative would be
A company has a process that results in 15000 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 $200000 and then sell it for $18 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? Sell now because the company will be better off by $50000. Process further because the company will be better off by $150000. Sell now because the company will be better off by $200000. Suy Process further because the company will be better off by $50000.
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