The world price of zinc has increased to the point where​ "moth balled" zinc mines in east Tennessee have been reopened because of their potential profitability.
a. What is the estimated annual profit for a mine producing 23,000 tons per year​ (which is at​ 100% capacity) when zinc sells for​ $1.00 per​ pound? There are variable costs of $22.08 million at​ 100% capacity and fixed costs of $16 million per year.
b. If production is only 19,000 tons per​ year, will the mine be​ profitable?