A careful analysis of the cost of operating an automobile was conducted by a firm. The following model was developed: y = 4,000 + 0.20x, where y is the annual cost and x is the miles driven. a) If the car is driven 15,000 miles this year, the forecasted cost of operating this automobile = (enter your response as a whole number). b) If the car is driven 25,000 miles this year, the forecasted cost of operating this automobile = (enter your response as a whole number).

Question

Fatima Huynh

Business

8 May, 10:54

A careful analysis of the cost of operating an automobile was conducted by a firm. The following model was developed: y = 4,000 + 0.20x, where y is the annual cost and x is the miles driven. a) If the car is driven 15,000 miles this year, the forecasted cost of operating this automobile = (enter your response as a whole number). b) If the car is driven 25,000 miles this year, the forecasted cost of operating this automobile = (enter your response as a whole number).

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Answers (1)

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Isabelle Richmond · Answer 1

a. $7,000

b. $9,000

Explanation:

The computations are shown below:

a. The equation is

y = 4,000 + 0.20x

where,

X = miles driven

And y = Annual cost

Since 15,000 miles car is driven this year, so the forecasted cost would be

y = 4,000 + 0.20 * 15,000 miles

= 4,000 + 3,000

= $7,000

b. And if the car is driven 25,000 miles, so the forecasted cost would be

y = 4,000 + 0.20 * 25,000 miles

= 4,000 + 5,000

= $9,000

We simply put this miles in the equation above