Question

Arcelor Mittal Dofasco can buy iron ore pellets from Minnesota at US$110 per short ton (2000 pounds) or from Labrador at C$160 per metric tonne (1000 kg). Which source is more expensive and by how much in C$ per metric tonne? (Total: 7 marks) (1 pound = 0.4536 kg, C$1.1400 = US$1.00) Weight and currency calculations should be to 4 decimal places; the final answer rounded to the nearest cent. Determine the price of Minnesota ore in C$ per metric tonne.

a) C$ per metric tonne for Minnesota ore =

$168.8324
$193.6000
$201.6048
$218.1600

Answer 1

To determine the price of Minnesota ore in C$ per metric tonne, we need to convert the given price in US$ per short ton to C$ per metric tonne.

Step-by-step explanation:

To determine which source is more expensive, we need to convert the price of the Minnesota ore to C$ per metric tonne. Starting with the price given in US$ per short ton, we can convert it to US$ per metric tonne by multiplying by 0.9072 (since 1 short ton is equal to 0.9072 metric tonnes). Next, we can convert US$ to C$ by dividing by the exchange rate of C$1.1400 = US$1.00. Finally, we can round the result to the nearest cent.

Let's perform the calculations:

Price of Minnesota ore in US$ per metric tonne = US$110 / 0.9072 = US$121.0804

Price of Minnesota ore in C$ per metric tonne = US$121.0804 / C$1.1400 = C$106.2709

Therefore, the price of Minnesota ore in C$ per metric tonne is C$106.2709.