Options for recycling waste-what is the break-even point

Assignment Help Project Management

Reference no: EM131693166

A city is considering options for recycling waste. Currently, the city pays $65 per ton to a recycling company to collects recyclable waste. However, due to a Green Initiative, most citizens are separating the recyclable waste and the amount of recyclable waste has increased recently. The city is considering to build their own recycling facility. The fixed cost of running the recycling facility will be $200,000 per year. However, the city can earn a profit after selling the recycled material. It is estimated that the city can earn $15 per ton of collected recyclable waste. (In other words, variable cost is - $15).

What is the break-even point? Show your calculations.

If the forecasted amount of recyclable waste is 3,000 tons per year, what should the city do? Briefly explain your choice.

The current recycling company has offered another option: Instead of charging $65 per ton, they would charge $30 per ton if the city agrees to pay a fixed price (whether any recyclable waste is collected or not) of $50,000 per year. What should the city do? Keep the current option ($65 per ton), build a new facility, or choose new outsourcing option? Provide reasoning for your choice.

Reference no: EM131693166

Questions Cloud

Inflation rate will be over the next year : Bill Bernanke thinks the total real return on this investment will be only 5.5 percent. What does Bill believe the inflation rate will be over the next year?

Little s law can only be used when : Little s law can only be used when

Explain the major provisions of the law that you chose : Explain the major provisions of the law that you chose. Describe the economic impact of the law. Provide specific economic data from credible references.

What must the coupon rate be on these bonds : Ashes Divide Corporation has bonds on the market with 15 years to maturity, a YTM of 6.0 percent, and a current price of $1,216.50.

Options for recycling waste-what is the break-even point : A city is considering options for recycling waste. What is the break-even point?

Demonstrate the acceptable levels of cohesion : Demonstrate the acceptable levels of cohesion and adaptability within that system

Explain the cultural values of african american : The human brain receives information from its environment constantly, but how does it make sense of all this information?

Transformation at the call center improving the performance : What have you done to improving the performance of call centers?

Define the same and different for new and incumbent firms : How are the approaches to managing innovation the same and different for new and incumbent firms

User Account

All Pages