John purchased 12372 kWh of electricity and 3568 CCF of natural gas in a year. The cost of electricity is 7.1 cents/kWh and that of natural gas is 1.5 dollars per CCF. Assuming that 1 CCF of natural gas has 100,000 BTUs and 1 kWh has 3412 BTUs, what is the average cost of 1 MM BTUs for John.

Question

Lacey Bauer

Business

23 January, 12:08

John purchased 12372 kWh of electricity and 3568 CCF of natural gas in a year. The cost of electricity is 7.1 cents/kWh and that of natural gas is 1.5 dollars per CCF. Assuming that 1 CCF of natural gas has 100,000 BTUs and 1 kWh has 3412 BTUs, what is the average cost of 1 MM BTUs for John.

+3

Answers (1)

Know the Answer?

Ansley · Answer 1

A is correct option 15.6$

Explanation:

According to question,

Electricity purchased = 12372 kwh

Cost of electricity = 7.1 cent/kwh = 0.071dollar/kwh

Natural gas purchased = 3568 CCF

Cost of natural gas = 1.5 dollar/CCF

BTUs purchased per dollar

= ((12372*3412) + (3568*100000)) / ((12372*0.071) + (3568*1.5))

=64042.8376 BTUs / dollar

Now, cost of 1MMBTUs = 1000000/64042.8376

= 15.6 dollar