Assume that if the new product is introduced, sales of the current product would increase by 30,000 units per year. The current product has a selling price of 10 per unit with a variable cost of 6 per unit. It would also bring about an increase in accounts receivable and inventories of 60000 Using NPV determine if the new product should be introduced in this new scenario.

Answer rating: 100% (QA)

The NP V of the new product would be Sales of new product 30 000 units 10 per unit 300 ... View the full answer