Sommer Inc. is trying to determine how much to spend on safety equipment for its plant. The first column in the following table gives values for possible expenditures. The second column gives the expected number or worker injuries and the third column gives the expected severity per injury (cost to Sommer per injury) associated with each expenditure level. How much should Sommer spend on safety if it is trying to maximize firm value? Ignore the time value of money.

Expenditure Expected injuries Severity

0 10 10,000

15,000 7 8,000

30,000 5 7,000

45,000 4 5,000

60,000 3 5,000

75,000 2 5,000