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

Respuesta :

The correct answer is $1550

No trading or refinement Wti crude (base case)

10,000 bbl multiplied by the gasoline price per bbl, which comes to $780,000. WTI for ANS crude in a swap

10,150 bbl x 77 cents per barrel of gasoline = $781,550

Trading WTI for ANS crude would result in total benefits of $781,550, base case benefits of $780,000, and additional benefits of $1550.

Cost-benefit analysis (CBA), also known as benefit-cost analysis or cost-benefit analysis, is a methodical strategy for determining the advantages and disadvantages of various options. It is used to choose solutions that would maximize savings while obtaining advantages in areas including transactions, activities, and functional business requirements. A CBA can be used to assess current and possible courses of action, as well as to calculate or compare a decision's value to its cost. It is frequently used to assess commercial deals, project investments, and judgments about business or policy (especially public policy). Before enacting regulations or deregulatory measures, the U.S. Securities and Exchange Commission, for instance, must do cost-benefit studies.

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