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pompa pompa
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7 years ago
Mark must buy four new tires for his car. He is considering buying tires that are $25 a piece more than his regular brand, because the higher priced tires are supposed to increase his miles per gallon by 20%. If the tires are good for 48,000 miles and Mark drives an average of 1,000 miles per month, gas costs $2.50 per gallon over the next 4 years, and Mark's car gets 30 miles to the gallon now (on the old tires), should Mark purchase the more expensive tires?
A) Yes, because Mark will save about $660 dollars in gas over the four years but the new tires will only be $100 more.
B) Yes, because Mark will save about $560 dollars in gas over the four years but the new tires will only be $100 more.
C) No, because Mark will only save about $60 dollars in gas over the four years but the new tires will only be $100 more.
D) No, because Mark will only save about $90 dollars in gas over the four years but the new tires will only be $100 more.
Textbook 
Principles of Managerial Finance

Principles of Managerial Finance


Edition: 14th
Authors:
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UlainUlain
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7 years ago
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3 years ago
Great thank you!
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