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XComoany is thinkag about expanding the production of Product A and timinating froduct B. Expanding sales of A should result in additional firm profits of
XComoany is thinkag about expanding the production of Product A and timinating froduct B. Expanding sales of A should result in additional firm profits of 512 ,000 per year fer the next 8 yeans, but wa require the purchase of some additional equigment, costing $13,000. This equipment should be worth $3,000 at the end of 8 years. Ey eliminating Product B, the from will lose the product's 18,000 antual coetnbutien margin but wil save $11,000 of annual fived costs Assuening a discount rate of 7W, what is the net present value of expanding the production of Prosuct A and elminating Procuct b3? OE:125,6117OC:137,247O154,000Tries0,99
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