Question
After extensive research and development, Goodweek Tires, Inc., has recently developed anew tire, the SuperTread, and must decide whether to make the investment necessary to
After extensive research and development, Goodweek Tires, Inc., has recently developed anew tire, the SuperTread, and must decide whether to make the investment necessary to produce and market it. The tire would be ideal for drivers doing a large amount of wetweather and off-road driving in addition to normal freeway usage. The research anddevelopment costs so far have totaled about $10 million. The SuperTread would be put onthe market beginning this year, and Goodweek expects it to stay on the market for a totalof four years. Test marketing costing $5 million has shown that there is a significant marketfor a SuperTread-type tire.
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