Question

If you rent a car, you can (1) return it with a full gas tank, (2) return it without filling it and pay $5.20/gallon, or (3) accept a fixed price of $55 for gas. The local price is $3.30/gallon for gasoline, and you expect this car to get 25 miles per gallon. The car has a 16-gallon tank. What choice should you make if you expect to drive: (a)150 miles

Answer 1

Answer:

(1) return it with a full gas tank

Explanation:

To find the best choice you have to evaluate each alternative. First, you need to find the amount of gallons you would use if you drive 150 miles:

1 gallon →  25 miles

      x     →  150 miles

x=(150*1)/25=6 gallons

(1) return it with a full gas tank:

local price for gasoline: $3.30/gallon

$3.30*6=$19.8

(2) return it without filling it and pay $5.20/gallon

$5.20*6=$31.2

According to this, return it with a full gas tank would cost $19.8, return it without filling it would cost $31.2 and the other option would be to accept a fixed price of $55 for gas. Considering this information, the choice that you should make if you expect to drive 150 miles is return it with a full gas tank because it is the cheapest option.