American Automobile Association (AAA) states that it costs on average 73 cents p

Question

American Automobile Association (AAA) states that it costs on average 73 cents per mile to drive a car 10,000 miles per year. The AAA includes the following costs in its calculation: fuel, maintenance, repair and tires, insurance, license and registration fees, depreciation and interest on car loans.

Your employer wants you to attend a conference for work.   You plan to attend the conference whether you drive your own car or not. Your employer offers you 52 cents a mile if you drive your own car. Will it pay for you to drive, or should you say no and hitch a ride with someone else? Explain how you would make that decision in a few sentences.

Explanation / Answer

Answer : My employer pay for my own car driving by myself and I will take it. Because according to AAA, per mile average driving cost is 73%. But if I drive my own car to attend a conference then my employer will pay 52% for my own car driving. Now if I take this per mile 52% payment for driving my own car then this will reduce my driving cost for attending conference by 52% per mile. While if my car is driving by AAA then it will cost 73% per mile for me to attend the conference. Therefore, here if I take per mile 52% payment then my own car driving cost is decreased by (73 - 52) = 21% per mile. Hence I will decide to take the payment of 52% per mile to attend the conference.

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