Cost-Benefit Analysis

Contents 1 Introduction 2 Costs: How much will Minecrobe cost? 3 Initial Costs 4 Recurring Costs

Introduction

For the purpose of analysis, a product similar to Minecrobe named Milky Spore is considered. Milky Spore which contains Bacillus popilliae, a species inhabiting the soil which infects and kills grubs. Due to the similarities between Milky Spore and Minecrobe many analogies can be made especially in the manufacturing and packaging processes as well as costs and benefits of those processes. The main differences between the two products are their purpose and the scale at which they are intended to be used. Milky Spore is a home and garden pesticide while Minecrobe aims to be an industrial product to promote nutrient uptake in crops.

Costs: How much will Minecrobe cost?

There are two main cost types associated with the production and distribution of the final Minecrobe product: initial costs and recurring costs. Initial costs include the costs of research and development, lab time, reagents, and parts. Recurring costs include those incurred in creating, growing, and shipping the final product. The recurring costs influence the final price a great deal more than initial costs, because the initial costs are spread over all Minecrobe produced, while recurring costs are not.

Initial Costs

The initial costs of the product were near-zero given that all the research and development was performed using the generous donations from our sponsors. The following table contains initial cost information:

The following items will be necessary to produce Minecrobe on an industrial scale:

1. Prices from a representative of The Fitzpatrick Company.

Recurring Costs

Material Costs

In order to determine recurring costs, all the reagents necessary to produce Minecrobe along with the amount needed per batch made must be taken into account. The following table includes information on the cost of the sporulation medium used: