20 Quest,io' Ba,k - l)ngi'e.

rirrg llco,onrics by J:rrr,r, ll ,l'iong

Present EconomY 21

Net income = 28000 - 400

a new gold mining area in Southern Leyte, the ore contains on the average
-ln
of.ten ounces of gold per ton. Different methods of processing = P 27600
t.ort"t"o
follows: "r" ". .j. Processing Method A yields the biggest return'
Processinq Method Cost per ton % Recoverv
A P 5,500 90
B P 2.500 80
C P 400 70
r\^ ^aaaccanr crarinn of the enoineS. lRf MotOrS lnC. will pay freight On

A. Processing method A
B. Processing method B
C. Processing method C
D. Either of the processing methods B or C

,%zn*
For Processing Method A:
A. P 670 Per engine C. P 650 Per engine
D. P 610 Per engine
B. P 630 Per engine
+ooo'][ to ounces)fo.got
lncome per ton - [p
\ ounce /( ton )'
= P 36,000 lf shipped in container:

Net income = 36000 - 5500

cost or rreight t"".(!#)
= P 30,500
=
[#}..
= 1 20000
For Processing Method B:

p +ooo t o ounces
rncome per ton -[ )[
\ ounce /\ ton )')ro.aot
= P 32,000

= 20 engines
Net income = 32000 - 2500
= P 29,500 . cost of freight
cost per englne =
nr-m0", of ensine"
For Processing Method C:
'n20000
1

+ooo'1( t o ounces
lncome per ton - [p
\ ounce /\ ton )(o.zot
)' , = P 6,000

= P 28000
lf shiPPed in crates:

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