Question: ( 1 - ) Cat ( dot { C } ) makes a product using three machines ( -

\(1-\)
Cat \(\dot{C}\) makes a product using three machines \(-X, Y \) and \( Z \). The capacity of each machine is as follows:
The demand for the product is 1,000 units per week. For every additional unit sold per week, net present value increases by \(\$ 50,000\). Cat Co is considering the following possible purchases (they are not mutually exclusive):
Purchase 1 Replace machine \( X \) with a newer model. This will increase capacity to 1,100 units per week and costs \(\$ 6\mathrm{~m}\).
Purchase 2 Invest in a second machine Y, increasing capacity by 550 units per week. The cost of this machine would be \(\$ 6.8\mathrm{~m}\).
Purchase 3 Upgrade machine \( Z \) at a cost of \(\$ 7.5\mathrm{~m}\), thereby increasing capacity to 1,050 units.
Required:
Which is Cat Co's best course of action?
 \(1-\) Cat \(\dot{C}\) makes a product using three machines \(-X, Y

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