Breakeven Analysis An aerodynamic three-wheeled automobile (the Dart) runs on compressed natural gas stored in two cylinders in the rear of the vehicle. The $13,000 Dart can cruise at speeds up to 80...

Breakeven Analysis



An aerodynamic three-wheeled automobile (the Dart) runs on compressed natural
gas stored in two cylinders in the rear of the vehicle. The $13,000 Dart can cruise
at speeds up to 80 miles per hour, and it can travel 100 miles per gallon of fuel.
Another two-seater automobile costs $10,000 and averages 50 miles per gallon of
compressed natural gas. If fuel costs $8.00 per gallon and MARR is 10% and 15%
per year, over what range of annual miles driven is the Dart more economical?
Assume a useful life of five years for both cars.