Question

If 1 pound of whole butter costs $2.69, what is the final cost to produce 1 pound of clarified butter?

$2.69
$3.36
$2.02
$0.67

Answer 1

I think it’s is 2.69 if there is no sales tax

Answer 2

The correct answer is $3.36.

Step-by-step explanation:

The final cost to produce one pound of clarified butter can never be less than the cost of one pound of pure butter. This is due to the basic principle of value addition. By processing the raw material we are giving it an added value, thus increasing the value of the raw material.

Have a nice day!