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X Company is planning to stop the production and sale of Product Q, which lost $11,000 last year. If Product Q is dropped, two things
X Company is planning to stop the production and sale of Product Q, which lost $11,000 last year. If Product Q is dropped, two things will happen in each of the next three years: 1) last year's loss will be avoided, and 2) sales of Product R will be increased, contributing $9,000 to annual profits. In addition, if Product Q is dropped, the company will be able to sell some equipment immediately for $17,000. Assuming a discount rate of 4%, what is the net present value of stopping the production and sale of Product Q?
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