For every kilogram of benzene that Oil produces, it will forgo selling a litre of petrol. However, 100 million kilograms per year would be only a small portion of total volume at the refinery. Following are Oil's expected revenues and costs for the production of benzene (these costs include the costs of refining the crude oil): Per kg Selling price (to Chemical) $ ? Costs: Crude oil $0.06 Variable production costs $0.04 Fixed production costs $0.09