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7 Required Information [The following information applies to the questlons displayed below] Atwater Chemicals produces an engine additive for machinery. The additive is produced by
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Required Information [The following information applies to the questlons displayed below] Atwater Chemicals produces an engine additive for machinery. The additive is produced by adding varlous ingredients to a petroleum-based lubricant. Atwater purchases the lubrlcant from two suppllers. Woodlawn Petroleum and Spokane Chemicals. The quality of the final product depends directly on the quality of the lubricant. If the lubricant is "off," Atwater has to dispose of the entire batch. Because all lubricant can be "off," Atwater uses a measure it calls the "yleld," which is computed as Yleld=GoodoutputInput where the output and input are both measured In barrels. As a benchmark, Atwater expects to get 12 barrels of good output for every 16 barrels of lubricant purchased for a yleld of 75 percent (= 12 barrels of output 16 barrels of lubricant). Data on the two suppllers for the past year follow: quired: sume that the average quality, measured by the yleld, and prices from the two companles will continue as in the past. What is the ective price for lubricant from the two companles when quality is considered? te: Do not round intermedlate calculations. Round your answers to 2 decimal places. Answer is complete but not entirely correctStep by Step Solution
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