A producer of synthetic motor oil for automobiles and light


A producer of synthetic motor oil for automobiles and light trucks has made the following statement: "One quart of Dynolube added to your next oil change will increase fuel mileage by two percent. This one-time additive will improve your fuel mileage over 50,000 miles of driving."

a. Assume the company's claim is correct. How much money will be saved by adding one quart of Dynolube if gasoline costs $3.34 per gallon and your car averages 20 miles per gallon without the Dynolube?

b. If a quart of Dynolube sells for $20.43, would you use this product in your automobile?

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Business Economics: A producer of synthetic motor oil for automobiles and light
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