The Red Company should recognize an impairment loss on its investment in the Green Company. To calculate this loss, we need to compare the lower of the fair value less costs to sell and the value in use with the carrying amount of the investment.

The fair value less costs to sell is 1.5 million (fair value) - 0.1 million (costs to dispose), which equals 1.4 million. The value in use is given as 1.7 million.

Since the fair value less costs to sell (1.4 million) is lower than the value in use (1.7 million), the impairment loss is based on the fair value less costs to sell.

The carrying amount of the investment is 2 million. So, the impairment loss is calculated as the difference between the carrying amount and the lower of the two values:

Impairment Loss = Carrying Amount - (Fair Value - Costs to Sell) Impairment Loss = 2 million - 1.4 million Impairment Loss = 0.6 million

Therefore, the Red Company should recognize an impairment loss of 0.6 million on its investment in the Green Company.