Why do we need to subtract 10% from the Infra cost calculation. It is stated that consumption decreases by 10%, how to conclude it is 10% implication on Infra.
Rgds,
M.
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Infra cost calculation
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Hello Max,
There is a little typo on the solution. In a warmer winter you will have gas consumption reduced by 10%, that implies a reduction of 10% of sales and variable costs (the hypothesis is to consider them linearly dependant).
Talink about the Infrastructure costs, they are composed by fixed (60%) and variable(40%) costs. Applying the saving on the variable part you have:
240*40%*10%=9.6
So that the new Infrastructure costs will be 240-9.6=230.4
Does it make sense?
Feel free to contact me if you have any doubt.
Luca
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Perfect ! Once again Thanks a lot!