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Coronado Industries produces facial moisturizer. Each bottle of moisturizer costs $ 1 5 to produce and can be sold for $ 1 8 . The

Coronado Industries produces facial moisturizer. Each bottle of moisturizer costs $15 to produce and can be sold for $18. The bottles can be sold as is, or processed further into sunscreen at a cost of $11 each. Coronado Industries could sell the sunscreen for $25 per bottle. What decision should the company make and why?
Moisturizer should be processed into sunscreen because its unit profit it $14.
Moisturizer should not be processed into sunscreen because unit profit decreases by $1.
Moisturizer should not be processed into sunscreen because incremental costs exceed incremental revenue.
Moisturizer should be processed into sunscreen because unit profit increases by $3.
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