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Kristen purchased a used automobile with an expected life of 4 years for $10,000 at the beginning of last year and incurred the following operating

Kristen purchased a used automobile with an expected life of 4 years for $10,000 at the beginning of last year and incurred the following operating costs:

Depreciation $ 2,500
Insurance $ 1,700
Automobile tax and license $ 600
Gasoline $ 0.20 per mile
Other variable operating costs $ 0.11 per mile

Assuming Kristen drove the car 12,000 miles last year, compute the average cost per mile of owning and operating the car.

a.

0.40

b.

0.71

c.

0.31

d.

0.11

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