A power plant currently uses coal from Source A but must swi

A power plant currently uses coal from Source A but must switch to Source B. Given the following data about the coal sources, how much will the cost of generation per kWh increase or decrease because of the switch. If the switch increases generation cost, give your answer as a positive number. If the switch decreases generation cost, give your answer as a negative number. Express your answer in cents/kWh to the nearest 1/100th cent.

Solution

Total Cost from Source A = 34 +140 = 174 $/ton
Total Cost from Source B = 61+ 80 = 141 $/ton
So, cost of generation from source A = 174 * 6900 = 1200600 $/kWh = 120060000 cents/kWhr
Cost of generation from source B = 141 * 7800 = 1099800 $/kWh = 109980000 cents/kWhr
Clearly , we see that the switch decreases generation cost by 109980000 - 120060000 = - 10080000 cents/kWhr