is the estimated annual profit for a mine producing 21,000 tons per year (which is at 100% capacity) when zinc sells for $1.00 per pound? There are variable costs of $19.74 million at 100% capacity and fixed costs of $16 million per year. duction is only 17,000 tons per year, will the mine be profitable? stimated annual profit is $ 6260000 (Round to the nearest dollar.) e mine be profitable at 17,000 tons per year? Choose the correct answer below. s C

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
Chapter8: Cost Analysis
Section: Chapter Questions
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The world price of zinc has increased to the point where "moth balled" zinc mines in east Tennessee have been reopened because of their potential profitability.
a. What is the estimated annual profit for a mine producing 21,000 tons per year (which is at 100% capacity) when zinc sells for $1.00 per pound? There are variable costs of $19.74 million at 100% capacity and fixed costs of $16 million per year.
b. If production is only 17,000 tons per year, will the mine be profitable?
a. The estimated annual profit is $ 6260000. (Round to the nearest dollar.)
b. Will the mine be profitable at 17,000 tons per year? Choose the correct answer below.
O
Yes
No
G
Transcribed Image Text:The world price of zinc has increased to the point where "moth balled" zinc mines in east Tennessee have been reopened because of their potential profitability. a. What is the estimated annual profit for a mine producing 21,000 tons per year (which is at 100% capacity) when zinc sells for $1.00 per pound? There are variable costs of $19.74 million at 100% capacity and fixed costs of $16 million per year. b. If production is only 17,000 tons per year, will the mine be profitable? a. The estimated annual profit is $ 6260000. (Round to the nearest dollar.) b. Will the mine be profitable at 17,000 tons per year? Choose the correct answer below. O Yes No G
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