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The company needs to decide whether to continue with the project. What is the marginal cost of continuing with and complete the project?

The company needs to decide whether to continue with the project. What is the marginal cost of continuing with and complete the project?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Company XYZ planned to invest $20 million in a new digital camera project. After the initial 5 million dollars were invested, the company realized that cellphones with cameras has become increasingly popular among consumers and this may significantly reduce the demand for their new digital cameras. After collecting data and revising the demand for the new cameras, the estimated sales at completion of the project would be $12 million. The company needs to decide whether to continue with the project. What is the marginal cost of continuing with and complete the project? $5 million $12 million $20 million $15 million
Transcribed Image Text:Company XYZ planned to invest $20 million in a new digital camera project. After the initial 5 million dollars were invested, the company realized that cellphones with cameras has become increasingly popular among consumers and this may significantly reduce the demand for their new digital cameras. After collecting data and revising the demand for the new cameras, the estimated sales at completion of the project would be $12 million. The company needs to decide whether to continue with the project. What is the marginal cost of continuing with and complete the project? $5 million $12 million $20 million $15 million
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