1 - There have been many stories and political statements about the effects of a
ID: 3251814 • Letter: 1
Question
1 - There have been many stories and political statements about the effects of a decrease in the price of gasoline on the total US consumer spending. In 2015, the price of gasoline gas went down by at least $1.00 dollar a gallon. Estimate the total extra money in the pockets of the US consumers of gasoline for the 2015 year.
You must first answer the following questions which will help you in estimating the answer.
Estimate the total number of cars on the road in the US in 2015. In 2015 the US sold approximately 15 million cars which last about 10 years on average.
b- Estimate the average number of miles driven by a typical car in a year.
c- Estimate the miles per gallon of gas and thus the number of gallons of gas consumed by an average car per year.
From a, b and c above you should be able to calculate the money saved by multiplying the number of cars times the savings of $1.00 a gallon for the number of gallons used in a year for a typical car. You do not have to know the price of gas only the fact that gas is $1.00 per gallon cheaper.
All are estimation questions base on any info you gave googled.
Explanation / Answer
a) Total no of cars on road will be 15*10 millions = 150 millions
b) According to the U.S. Department of Transportation Federal Highway Administration (FHWA), the average American driver logs 13,476 miles each year.
c)
As per 2014 reports on fuel economy, average of 23.6 miles per gallon, a car uses.
So total money saved is
150 million* 13,467*23.6 = $47,673.18 billion
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.