Daniel Is Trying to Decide Whether to Buy a Car

question 59

Multiple Choice

Daniel is trying to decide whether to buy a car or a truck. The truck he is considering will cost him a month in loan payments, and it gets miles per gallon in gas mileage. The car will cost a month in loan payments, but it gets miles per gallon in gas mileage. Daniel estimates that he will pay per gallon for gas. This means that the monthly cost to drive the truck miles will be The total monthly cost to drive the car miles will be The following figure shows the graph of each equation. At how many miles do the car and the truck cost the same to operate?

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Definitions:

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials and labor costs.

Period

A length of time in financial reporting, often quarterly or annually, used to evaluate business performance.

Cost of Goods Manufactured

The total cost incurred by a company to produce goods in a specific period, including labor, material, and overhead costs.

Raw Materials

Basic materials and substances used in the initial stages of production before transformation into finished goods.