Beverly Mills has decided to lease a hybrid car to save on gasoline .pdf

Beverly Mills has decided to lease a hybrid car to save on gasoline expenses and to do her part to
help keep the environment clean. The car she selected is available from only one dealer in the
local area, but that dealer has several leasing options to accomadate a variety of driving patterns.
All the leases are for 3 years and require no money at the time of signing the lease. The first
option has a monthly clost of $330, a total mileage allowance of 36,000 miles (an average of
12,000 miles per year), and a cost of $0.35 per mile for any miles over 36,000. The following
table summarizes each of the three lease options:
3 year lease Monthly cost Mileage Allowance Cost Per Excess Mile
Option 1 $330 36,000 $0.35
Option 2 $380 45,000 $0.25
Option 3 $430 54,000 $0.15
Beverly has estimated that, during the 3 years of the lease, there is a 40% chance she will drive