What level of effect is a Potion of Sweet Water?

Say I put an alchemist on payroll, hand him a potion formula and an expense fund, and go away for a while, what exactly happens? Can the alchemist use my formula, cancelling out his double cost and time?

And what is said alchemist's cost for components specifically? He needs cost plus "components ... with a total xp value equal to the gp cost of the research." And looking components up in *L&E* tells me *their* gp cost is equal to their xp value, so components with a gp cost equal to the "cost of the research" if he can buy them at market. Does component cost come after all modifiers, going up and down for alchemists versus mages and formula versus none, or is it fixed somewhere? If fixed, always at base cost, or can a formula fix it down to formula cost?