pleas show all steps A pilot plant has been constructed to convert garbage to oi
ID: 1812410 • Letter: P
Question
pleas show all steps
A pilot plant has been constructed to convert garbage to oil, natural gas, and charcoal. The plant cost 44 million build and will have a 20-year life with no salvage value. The cost of processing 1 ton (907 kg) of garbage is $14. From each ton are derived products which can be sold for $21 ($0.023 per kg). However, 20 % of the end products are consumed as energy during the processing The cost of delivery, sorting, and shredding a ton of garbage is $2.SO (0.0028 per kg), after deducting the value of the salvageable materials recovered. How many tons (kg) of garbage must be processed to recover the cost of the plant at an interest rate of 9%?Explanation / Answer
Plant cost = 44 million
Cost of processing one ton=$14
One ton sold at price=$21
Cost of delivery=$2.50
For interest rate of 9%=44000000*0.09=$3960000
Profit earned from one ton=$21-($14-$2.50)
=$21-$16.50
=$4.50
SO production required for interest rate of 9% on cost of production of plant=3960000/4.50=880000 tons
SO 880000 tons should be produced for earning a interest rate of 9%.!!
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