Use the Information for the Question(s)below

question 100

Multiple Choice

Use the information for the question(s) below.
As an oil refiner, you are able to produce $76.16 worth of unleaded petrol from one barrel of Tapis Outback Crude (TOC) oil. Because of its lower sulphur content, you can produce $77.25 worth of unleaded petrol from one barrel of Western Australian Intermediate (WAI) crude.
-Assuming you currently have 10 000 tonnes of WAI crude, the added benefit (cost) to you if you were to sell the 10 000 tonnes of WAI crude and use the proceeds to purchase and refine TOC crude are closest to:

• A)($524)
• B)$524
• C)($1 819)
• D)$1 819

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Definitions:

Excess Returns

Excess returns refer to the returns achieved above a benchmark or a risk-free rate of return.

Market Index

A statistical measure that reflects the overall movement of the market or a specific sector of the market.

Global Minimum Variance Portfolio

An investment portfolio that aims to achieve the lowest possible level of risk (variance) for a given rate of expected return, comprising assets from around the world.

Standard Deviation

A statistical measure of the dispersion or variability of a set of data points, often used in finance to gauge the volatility of an investment's return.