Decided to purchase a new fuel efficient car

Assignment Help Operation Management

Reference no: EM131479102

You are looking to purchase a car. You have decided to purchase a new fuel efficient car or a older one that is a big gas burner. From your analysis the following information has been determined.

NEW CAR: * Cost $15,000 and you would probably keep it for 10 years. After 10 years it could probably be sold for $2,000. Therefore, cost is $1,300/Year. (Fixed Cost) * Insurance Cost will be $500/Year (Fixed Cost) * Tires $300/50,000 Miles (Variable Cost) * Battery $60/2.5 Years (Fixed Cost) * Gas Mileage Is 28 MPG & Gas Cost $1.24/Gallon (Variable Cost)

MUCH OLDER CAR: * Cost $2,000 and you would probably keep it for 5 years. After 5 years it could probably be sold for $200. Therefore, cost is $360/Year. (Fixed Cost) * Insurance Cost will be $250/Year (Fixed Cost) * Tires $300/50,000 Miles (Variable Cost) * Battery $60/2.5 Years (Fixed Cost) * Gas Mileage Is 12 MPG & Gas Cost $1.24/Gallon ( Variable Cost)

You normally drive an average of 25,000 miles each year. Based solely on economic factors, which car will you purchase? At what annual mileage is it more economical to drive the new car?

Reference no: EM131479102

Questions Cloud

Deciding whether tri-circle was entitled to finance charges : In deciding whether Tri-Circle was entitled to finance charges, the court first inquired whether Brugger, Weimer, and Tri-Circle were merchants.

Brewster manufactured plastic bottles : YOU BE THE JUDGE WRITING PROBLEM Brewster manufactured plasticbottles.

Quality consulting has two consultants : Quality Consulting has two consultants, Alfred and Barbara that can be scheduled to work for clients up to a maximum of 170 hours each over the next four weeks.

Sale of seventy-six specially made motion detectors : Nancy and Mitch enter into a contract for a sale of seventy-six specially made motion detectors

Decided to purchase a new fuel efficient car : You have decided to purchase a new fuel efficient car or a older one that is a big gas burner.

Creating table for the epidemiology : creating a table for the following Epidemiology question. Investigators are interested in the effect of TV watching on obesity rates among young children.

Explain the relationships among international supply chains : Explain the relationships among international supply chains, inventory carrying costs, transportation costs, etc.

Using the triangle of satisfaction model : Using the Triangle of Satisfaction model, how would you analyze the event from three varying positions: BP, state of Louisiana, and the U.S. federal government.

What kind of contract do the parties have : Massachusetts Bay Transit Authority (MBTA) awarded Perini Corp. largecontract to rehabilitate section of railroad tracks.What kind of contract do parties have.

User Account

All Pages