A Consumer Is Trying to Decide Whether to Purchase Car

question 109

Multiple Choice

A consumer is trying to decide whether to purchase car A or car B. Car A costs $10,000 and has an mpg rating of 30, and insurance is $500 per year. Car B costs $12,600 and has an mpg rating of 50, and insurance is $550 per year. Assume that the consumer drives 15,000 miles per year and that the price of gas remains constant at $1.25 per gallon. Based only on these facts, determine how long it will take for the total cost of car B to become less than that of car A.

• A)13 years
• B)17 years
• C)47 years
• D)57 years
• E)15 years