Use the Following Information to Answer the Question(s)below

question 13

Multiple Choice

Use the following information to answer the question(s) below.
d'Anconia Copper expects to produce 500 million pounds of copper next year,with production costs of $0.75 per pound.Depending upon the economic conditions over the next year,d'Anconia Copper expects the price of copper next year to be either $1.40,$1.50,or $1.60 per pound,with each outcome being equally likely.d'Anconia Copper expects to sell all of its copper at the going price.
-If the going price next year is $1.60 per pound,d'Anconia Copper's operating profit next year will be closest to:

• A)$365 million.
• B)$375 million.
• C)$425 million.
• D)$800 million.

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Definitions:

Assets

Economic resources owned or controlled by a business, expected to provide future benefits.

Supplies

Items or materials used in the operation of a business, often consumable in nature.

Owner's Equity

The residual interest in the assets of the entity after deducting liabilities, essentially the net assets owned by the proprietors.

Liability

Financial obligations or debts that a company owes to others, which need to be settled over time through the transfer of economic benefits including money, goods, or services.