ABC Inc. is the world's largest mining firm. It expects to produce 3.00 billion pounds of...

 

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ABC Inc. is the world's largest mining firm. It expects to produce 3.00 billion pounds of silver next year, with a production cost of $ 1.50 per pound. a) What will be ABC's operating profit from silver next year if the price of silver is $ 2.00, $ 2.25, or $ 2.50 per pound, and the firm plans to sell all of its silver next year at the going price? b) What will be ABC's operating profit from silver next year if the firm enters into a contract to supply silver to end users at an average price of $ 2.20 per pound? (Hint: Operating profit = sales - cost) ABC Inc. is the world's largest mining firm. It expects to produce 3.00 billion pounds of silver next year, with a production cost of $ 1.50 per pound. a) What will be ABC's operating profit from silver next year if the price of silver is $ 2.00, $ 2.25, or $ 2.50 per pound, and the firm plans to sell all of its silver next year at the going price? b) What will be ABC's operating profit from silver next year if the firm enters into a contract to supply silver to end users at an average price of $ 2.20 per pound? (Hint: Operating profit = sales - cost)

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a We are given Production Cost 150 per pound Expected production 300 b... View the full answer