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MBA, Ph.D in Management
Harvard university
Feb-1997 - Aug-2003
Professor
Strayer University
Jan-2007 - Present
Assume that you are a manager of a hypothetical ethanol company. You are tasked with evaluating options for a new production facility. Information on the ethanol industry is presented below. Answer the following questions.
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(a)       What market structure best describes the ethanol industry? Why did you choose that specification? Be detailed in your evidence.Â
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(b)       Discuss when and why you (as manager) might opt for employing a dry mill. Discuss when and why you (as manager) might opt for a wet mill. Be sure to include in your discussion long run cost curves, capital considerations, co-products, and all other relevant data. (as an additional hint: examine ADM & POET)
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(c)       Cellulosic ethanol is the next generation. There are mandates for production set by the US government, which is driving this market. Cellulosic ethanol is derived from agricultural residues (i.e. what’s left over after we use the product, so things like corn stalks) and dedicated energy crops. POET is entering the cellulosic market using corn cobs. If you were POET, would you use green-field development or add cellulosic production capabilities to your existing facilities? Why? Defend your choice with economic theory, not just intuition. [‘green-field’ means build a new facility from scratch in a different location].
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