How many miles would you have to drive car before upgrading

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Reference no: EM131881439

Your small remodeling business has two work vehicles. One is a small passenger car used for job-site visits and for other general business purposes. The other is a heavy truck used to haul equipment. The car gets 25 miles per gallon (mpg). The truck gets 10 mpg. You want to improve gas mileage to save money, and you have enough money to upgrade one vehicle. The upgrade cost will be the same for both vehicles. An upgraded car will get 40 mpg; an upgraded truck will get 12.5 mpg. The cost of gasoline is $3.20 per gallon.

Suppose you drive the truck 11,580 miles per year. How many miles would you have to drive the car before upgrading the car would be the better choice?

Reference no: EM131881439

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