Recycle America Inc. has the opportunity to trade 8,000 pounds of plastic pellets made from recycled soda bottles for 5,000 pounds of aluminum cans. If the current market price of scrap aluminum is $0.83 per pound and the current market price for plastic pellets is $0.57 per pound, then the added benefit (cost) of making this trade is: A) ($410) B) $410 C) ($780) D) $780
Recycle America Inc. has the opportunity to trade 8,000 pounds of plastic pellets made from recycled soda bottles for 5,000 pounds of aluminum cans. If the current market price of scrap aluminum is $0.83 per pound and the current market price for plastic pellets is $0.57 per pound, then the added benefit (cost) of making this trade is: A) ($410) B) $410 C) ($780) D) $780
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Recycle America Inc. has the opportunity to trade 8,000 pounds of plastic pellets made from recycled soda bottles for 5,000 pounds of aluminum cans. If the current market price of scrap aluminum is $0.83 per pound and the current market price for plastic pellets is $0.57 per pound, then the added benefit (cost) of making this trade is:
- A) ($410)
- B) $410
- C) ($780)
- D) $780
Expert Solution
Step 1: Introduction:
Making financial decisions with the added benefit or expense in mind is helpful. Cost-benefit analysis is another term for adding value or cost. It assists in determining whether or not the project should be pursued.
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