Larry Miller, the general manager of Basil Software, must decide when to release the new version of Basil's spreadsheet package, Easyspread 2.0. Development of Easyspread 2.0 is complete; however, the diskettes, compact discs, and user manuals have not yet been produced. The product can be shipped starting July 1, 2009.

The major problem is that Basil has overstocked the previous version of its spreadsheet package, Easyspread 1.0. Miller knows that once Easyspread 2.0 is introduced, Basil will not be able to sell any more units of Easyspread 1.0. Rather than just throwing away the inventory of Easyspread 1.0, Miller is wondering if it might be better to continue to sell Easyspread 1.0 for the next three months and introduce Easyspread 2.0 on October 1, 2009, when the inventory of Easyspread 1.0 will be sold out.

The following information is available:

honored 1." Eagle\" 2.\" Selling price w : Variable cost per unit of diskettes, compact discs, uaer menuaie 25 3D Developmem cost per unit in mi] Marketing and administrative cost per unit _4-|.'] Total cost per unit 13!) jg Operating income per unit 3 25