Revenue and cost information

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It is your first day on the job at the Itty Bitty Machine (IBM) company and your new boss wants your advice. The company has invested $10 million in its new computer software. The company has just received an offer from a Latin American company to purchase 100,000 copies of the software at a price of $50 each. While IBM has the capacity to produce the software, it will cost the firm one million dollars to translate the software into Spanish. In the absence of other information, should IBM accept or reject the offer? Please answer this question using the tools of analysis developed in this course.

Reference no: EM1316870

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