A delivery company is implementing a system to compare the costs of purchasing and operating different vehicles in its fleet. Truck 415 is driven 125,000 miles per year at a variable cost of $0.13 per mile. Truck 415 has a capacity of 28,000 pounds and delivers 250 full loads per year. What amount is the truck’s delivery cost per pound?
A.
$0.00163 per pound
B.
$0.00232 per pound
Incorrect C.
$0.58036 per pound
D.
$1.72000 per pound
correct answer is B. The truck has a variable cost of $0.13 per mile × 125,000 miles, or $16,250 per year. It delivers 28,000 pounds × 250 loads, or 7,000,000 pounds a year.
Dividing the annual cost of $16,250 by 7,000,000 pounds delivered each year gives a cost of $0.00232 per pound delivered.
why does the 250 loads matter?
.