Answer:
$0.445 per mile
Explanation:
Calculation for what the average cost per mile
will be over the 4 years
First step is to calculate the Insurance cost
Insurance cost = $1,200 x 4
Insurance cost = $4,800
Second Step is to calculate the Maintenance cost
Maintenance cost = $400 x 4
Maintenance cost = $1,600
Third Step is to calculate the Total mileage
Total mileage = 10,000 miles per year x 4 years Total mileage= 40,000 miles
Fourth step is to calculate the Gas cost
Gas cost =( 1 gallon/25 miles per gallon x 40,000 miles)x $4 per gallon
Gas cost = 1,600 gallons x $4 per gallon
Gas cost=$6,400
Last step is to calculate the average cost using this formula
Average cost =Initial cost+Insurance cost+Maintenance cost +Gas cost/Total mileage
Let plug in the formula
Average cost = $5,000 + $4,800 + $1,600 + $6,400/40,000 mile
Average cost= $17,800 / 40,000 miles
Average cost = $0.445 per mile
Therefore what the average cost per mile
will be over the 4 years will be $0.445 per mile
