Use the information for the question(s)below.
As an oil refiner,you are able to produce $76 worth of unleaded gasoline from one barrel of Alaska North Slope (ANS)crude oil.Because of its lower sulfur content,you can produce $77 worth of unleaded gasoline from one barrel of West Texas Intermediate (WTI)crude.
-Another oil refiner is offering to trade you 10,150 Bbls of Alaska North Slope (ANS)crude oil for 10,000 Bbls of West Texas Intermediate (WTI)crude oil.Assuming you currently have 10,000 Bbls of WTI crude,the added benefit (cost)to you if you take the trade is closest to:
A)($1400)
B)$1400
C)($3908)
D)$3908
E)$2508

Question

Use the information for the question(s)below.
  As an oil refiner,you are able to produce $76 worth of unleaded gasoline from one barrel of Alaska North Slope (ANS)crude oil.Because of its lower sulfur content,you can produce $77 worth of unleaded gasoline from one barrel of West Texas Intermediate (WTI)crude.
-Another oil refiner is offering to trade you 10,150 Bbls of Alaska North Slope (ANS)crude oil for 10,000 Bbls of West Texas Intermediate (WTI)crude oil.Assuming you currently have 10,000 Bbls of WTI crude,the added benefit (cost)to you if you take the trade is closest to:
A)($1400) 
B)$1400 
C)($3908) 
D)$3908 
E)$2508

Quizplus · Accepted Answer

With your current inventory of 10,000 Bbls of WTI crude, you can produce $77 x 10,000 = $770,000 worth of unleaded gasoline. If you make the trade, you will receive 10,150 Bbls of ANS crude, which can produce $76 x 10,150 = $771,400 worth of unleaded gasoline. The added benefit of making the trade is $771,400 - $770,000 = $1,400. Therefore, the best choice is option B, which is the closest to the added benefit of $1,400.

Use the Information for the Question(s)below