1. Next week you have to travel around parts of the country on business and have decided to hire a car from a car-hire company. You have contacted two companies which offer different services. The first company will rent you a car for $125 per day. The second company will charge $80 per day, but with an additional charge of 50 cents per kilometer travelled. You know you will require the car for four days but are unsure of the number of kilometers that you will cover.
(a) Determine mathematically what distance you need to cover to make the second company’s charge cheaper.
(b) Confirm this using Excel graphs.
(c) Both companies now realise that they will need to add 10% GST to the charge for the daily car hire, but not to the charge for the kilometres covered. How will this affect your decision? Justify your answer with both the calculations and Excel graphs.
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