Final answer:
The question relates to a business decision regarding the replacement of old equipment with new equipment that can support a new product line.
Step-by-step explanation:
The question posed suggests a scenario that is common in business finance or accounting, particularly in the area of capital budgeting decisions.
When a company is considering replacing old equipment with new equipment, it must analyze the costs involved, including the initial purchase price, any potential salvage value of the existing equipment, and the benefits that the new equipment will provide, such as increased efficiency or the ability to produce a new product line.
This would typically involve calculations like Net Present Value (NPV), Return on Investment (ROI), or Payback Period, and the decision would take into account factors such as depreciation, tax implications, and cost of capital.