Lithium is a key raw material used in most electric batteries. Suppose that in late 2016 Tesla purchased3,000 tons of lithium at a price of $7,200 per ton. In August 2017, suppose Tesla still had 2,000 tons of thelithium purchased in late 2016, but with price on an upward trend, Tesla purchased 2,000 tons of Lithium at$8,500 per ton. Consider the decision that Tesla has in September 2017, when they have to decide which part of theLithium inventory to use in production of their batteries. From a decision-making point of view (and ignoringany tax or reporting implications), Tesla should: 1. use only the Lithium purchased at $7,200 because that will lower production costs 2. use only the Lithium purchased at $8,500 in order to get rid of the high-cost Lithium as quickly as possible 3. use only the Lithium purchased at $8,500 because the cost of that Lithium is sunk 4. use approximately equal amounts of Lithium purchased at $7,200 and at $8,500 because that will balance out their average cost over the long run 5. use any part of their inventory; it doesn't matter what Lithium they use