Tech Industries, a contract manufacturer of circuit boards, is evaluating an inv

Question

Tech Industries, a contract manufacturer of circuit boards, is evaluating an investment in a new production line to handle the growing demand from its customers, who produce consumer electronic products. Based on reasonable growth assumptions, the NPV of the new production line was found to be -$2.3 million. Management feels obligated to therefore reject the project. It recognizes that the production line would provide a high degree of output flexibility because it could be repurposed easily and inexpensively to produce circuit boards for numerous other applications. The firm

Explanation / Answer

the output variability should be as possible as minimum in practicality to minimize the production variation.

my suggestion is agin they need to be consider and evaluate all the proposals from different departments, and analyse the data. if still it provides negitive NPV then reject the project

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