Break even Point?

The Break-Even Point?

Rent-A-Dent (RAD) has rental specials on compact cars:

a) Hondas rent for $25 per day and $.24 (24 cents) per mile.

b) Toyotas rent for $31 per day and $.19 (19 cents) per mile.

What is the break-even point for both rental cars, include the mileage and cost????

5 Answers

  • 1 decade ago
    Favorite Answer

    25*D + 0.24*M = 31*D + 0.19*M

    0.05*M = 6*D

    M/D= 120

    So you see, the number of days rented AND the mileage are important here! There are in a infinite number of break-even points, depending upon the number of days you plan to have the car, and/or how many miles you plan to drive.

    If you plan to have the car a fixed and stated number of days, then you can make a discrete calculation.

    For example, if you rent the cars for one day (D=1), then the breakeven mileage = 120.

    So: $25 + $0.24*120 = $53.80


  • Golfer
    Lv 6
    1 decade ago

    31+.19X = 25+.24X



    X=6/.05 = 120

    120 miles is the break even point

    The costs is $25+(.24x120)= 25+28.80=$53.80 for the Honda and

    $31+(.19x120) = 31+22.80=$53.80 for the Toyota

    As pointed out above, you would have to travel the 120 miles each day of the rental

  • 1 decade ago

    The break even point is 120 miles and $53.80 for each rental car.

    Hondas: 25 + .24x

    Toyota: 31 + .19x

    At the Break Even point, both will be equal, so

    25 + .24x = 31 + .19x

    Subtract .19x from both sides and subtract 25 from both sides to get

    .05x = 6

    Divide both sides by .05

    x = 120 miles

    If you plan on driving less than 120, then rent a Honda

    If you plan on driving more than 120 miles, then rent a Toyota

    Of course this is good if you rent for only one day. Multiply 120 miles by number of days you rent to get the amended break-even miles and multiply $53.80 by the number of days you rent to get the amended break-even cost.

  • 4 years ago

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  • 1 decade ago

    The break even point depends on days and mileage

    T= 25d+0.24m

    H =31d+0.19m

    25d+0.24m= 31d +0.19m


    So the break even points are on a straight line

    6x+0.05y =0 where x are the days and y the mileage


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