The Digby company will sell 100 units (x1000) of capacity from their Drat product line. Each unit of capacity is worth $6 plus $4 per automation rating. The Digby company will sell the capacity for 35% off. How much do they receive when the capacity is sold?

a. $3,400,000

b. $1,870,000

c. $1,190,000

d. $2,210,000

Answer: c. $1,190,000

Explanation:

100units (X 1000) capacity

Price per unit capacity = $6

Automation per rating = $4

Automation rating = 7

Value to be recieved

= ($6 + 7 x $4) x 100 x 1000 (0.35)

= $34 x 100000 x 0.35

= $1,190,000

The question is not complete, find the below complete question:

The Chester company will sell 100 units (x1000) of capacity from their Cat product line. Each unit of capacity is worth $6 plus $4 per automation rating. The Chester company will sell the capacity for 35% off. How much do they receive when the capacity is sold? Note: Automation rating is 7.0 per unit of capacity.

a) $1,870,000

b) $1,190,000

c) $2,210,000

d) $3,400,000

The correct option is C,$2,210,000

Explanation:

Th price per unit = $6 + ($4*automating rate) as given in the question

the price per unit=$6 + ($4*7)

=$6+$28

=$34

The actual worth of capacity = price per unit*number of units

number of units is 100,000

price per unit is $34

actual worth of capacity=$34*100,000

=$3,400,000

Actual amount received=$3,400,000 * (1-0.35)

=$2,210,000.00

The amount of received is $2,210,000