agm questions, page-85

Rowser,

You don't seem to get it.
There are two ways to quote costs:
- monthly/quarterly/yearly costs, and
- per unit of output (per ounce).

For a month:
Per unit of output costs (per ounce) = output per month / monthly costs.

No one is claiming that per unit of output ounce costs (per ounce) are at or close to $300 an ounce. The reason being that output per month is not at or close to what it needs to be to achieve that. What is being claimed is that if and when output per month reaches what is expected/hoped then per unit of output ounce costs (per ounce) will approach $300 an ounce. There are only two valid arguments to be made against this claim: 1) you argue monthly costs are going to increase, or 2) you argue output per month will not reach what is expected/hoped. Give us an plausible argument on either of those points and we will listen (whilst taking into account the fact that monthly costs are not expected to change if and when output increases, and the fact that expected/hoped increases in output are simply that: expectations based on information at hand). Beyond that the only other real argument to be made is that at current output levels the company isn't profitable (which reports have shown it is).