Accounting Question for Marginal/Differential Costs (not Financial Products): The average cost in 2015 of operating a domestically built motor bike are as below:

Particulars	Average per km
Variable Costs:
Fuel	Rs. 6.5
Maintenance	Rs. 5.4
Tires	Rs.0.7
Total Variable Cost	Rs. 12.6
Fixed Costs:
Insurance	Rs.1603
License, registration, taxes	Rs.415
Depreciation	Rs. 3782
Finance Charges (Assume a five-year loan at 6 percentage interest with a 10 percent down payment)	Rs.741
Total Fixed Cost	Rs. 6541

Assume that these costs are valid estimates of future costs. What are the differential costs in each of the following circumstances cited below?

(a) You own a typical domestic motor bike and has it registered. You are thinking about making a trip of 1000 km. What are the differential costs? (b) You do not own a motor bike but are considering the purchase of the motor bike described above. If your estimate is that you will drive 10000 km per year for five years and that alternative transportation will cost Rs. 4000 per year, should you do so?