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X Company is thinking about expanding the production of Pinduct X and eliminating Product Expanding sales of X should result in additional form profits of
X Company is thinking about expanding the production of Pinduct X and eliminating Product Expanding sales of X should result in additional form profits of $11.000 per year for the next 5 years, but wa require the purchase of some additional equipment, costing $14,000. This equipment should be worth 53.400 at the end of years By eliminating Product Y, the firm wil lose the product's $6,000 annual contribution margin but will save $13,000 of annual feed costs Assuming a discount rate of what is the net present value of expanding the production of Product and eliminating Product
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