Zinc concentrate

silver payable 50.0%

zinc payable 85.0%

Lead concentrate

silver payable 95%

lead payable 95%

Income statement ($000)

zinc ($/lb) $1.00

lead ($/lb) $0.95

silver($/t.0z) $20.00

Mining cost ($/ore tonne mined) $5.19

Processing plant ($/ore tonne mined) $8.76

General Administration ($/ore tonne mine) $ 1.55

Treatment & charges zinc concentrates

Treatment charges $229.00

price participation $(1.80)

penalty $24.24

Transportation $139.00

Lead concentrates

Treatment concentrates

Price participation $ -

Penalty $6.40

silver refining charges $52.20

Transportation $139.00

Taxes

Corporate tax rate 33 %

Discount 5 %

Using the financial model spreadsheet provided,determine the impacts of the overall economics.NOTE:only change one thing at a time and change it back after you have completed the analysis.

a) zinc price increases to $1.25/lb