You currently drive 288 miles per week in a car that gets 24 miles per gallon of gas. you are considering buying a new fuel-efficient car for $15,000 (after trade-in on your current car) that gets 48 miles per gallon. insurance premiums for the new and old car are $800 and $600 per year, respectively. you anticipate spending $1000 per year on repairs for the old car and having no repairs on the new car. assume gas costs $3.50 per gallon. over a five-year period, is it less expensive to keep your old car or buy the new car? by how much?
a. Keep old car, $2000 less expensive
b. Keep old car, $1000 less expensive
c. Buy new car, $1000 less expensive
d. Buy new car, $2000 less expensive