Questions: Complete the problem. (From Example 2) 2. Anwar Mabak incurs 2,818.00 in annual fixed costs to operate his car. He estimates that he will drive 22,500 miles during the year. What are his annual variable costs if his cost per mile is 0.32?

Solution Steps

To find the annual variable costs, we need to multiply the cost per mile by the total number of miles driven in a year.

To find the annual variable costs, we use the formula:

\[ \text{Annual Variable Costs} = \text{Miles Driven} \times \text{Cost per Mile} \]

Substituting the given values:

\[ \text{Annual Variable Costs} = 22500 \, \text{miles} \times 0.32 \, \text{USD/mile} \]

Calculating the above expression:

\[ \text{Annual Variable Costs} = 7200.0 \, \text{USD} \]

Final Answer