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Walmart Inc. considers expanding its distribution centers. In September 2039, the company estimates the following costs: Current Operating Costs: $15,000,000 Expansion Costs: $22,000,000 Additional Revenue

Walmart Inc. considers expanding its distribution centers. In September 2039, the company estimates the following costs:

  • Current Operating Costs: $15,000,000
  • Expansion Costs: $22,000,000
  • Additional Revenue from Expansion: $28,000,000

Requirements:

  • Perform relevant cost analysis for the expansion decision.
  • Calculate the net benefit of the expansion.
  • Analyze the impact of the expansion on current operations.
  • Prepare a recommendation report for management.
  • Discuss the potential risks and benefits of the expansion.

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