Use the Information for the Question(s)below

question 35

Multiple Choice

Use the information for the question(s) below. As an oil refiner, you are able to produce $77 worth of unleaded gasoline from one barrel of Alaska North Slope (ANS) crude oil. Because of its lower sulfur content, you can produce $78 worth of unleaded gasoline from one barrel of West Texas Intermediate (WTI) crude. Assuming you currently have 10,000 bbl of WTI crude, the total benefits to you if you were to sell the 10,000 bbl of WTI crude and use the proceeds to purchase and refine ANS crude is closest to ________.

• A)$794,274
• B)$780,000
• C)$781,550
• D)$784,091

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Definitions:

Standard Deviation

A statistical measure of the dispersion or variability in a set of data points, often used to gauge the risk associated with a financial asset.

Good Economy

A state of economic health in which a nation experiences growth, low unemployment, and increasing wealth among its population.

Poor Economy

A state of economic performance characterized by low growth rates, high unemployment, and generally declining business activity.