A cement grinding mill "A" with the capacity of 50 tons per hour utilizes forged steel grinding balls costing P12,000 per ton, which have a wear rate of 100grams per ton cement milled. Another cement mill "B" of same capacity uses high chrome steel grinding balls costing P30,000 per ton with wear rate of 10grams per ton cement milled. Determine by calculation the more economical grinding mill, considering other factors to be the same and how much is the difference incurred in losses.

A cement grinding mill "A" with the capacity of 50 tons per hour utilizes forged steel grinding balls costing P12,000 per ton, which have a wear rate of 100grams per ton cement milled. Another cement mill "B" of same capacity uses high chrome steel grinding balls costing P30,000 per ton with wear rate of 10grams per ton cement milled. Determine by calculation the more economical grinding mill, considering other factors to be the same and how much is the difference incurred in losses.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter17: Long-term Investment Analysis

Section: Chapter Questions

Problem 10E

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