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Consider the following costs of owning and operating a car. A $15,000 Ford Taurus financed over 5 years at 10 percent interest means a monthly payment of $318.71. Insurance costs $100 a month regardless of how much you drive. The car gets 20 miles a gallon and uses unleaded regular that costs $3.05 per gallon. Finally suppose that wear and tear on the car costs 15 cents a gallon. Which costs are fixed and which are variable? Why? Explain. Also, in deciding whether to drive from New York to Pittsburgh(about 1,000 miles round trip) to visit a friend, which costs would you consider and why?

Reference no: EM132030604

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