1. **State the problem:** Calculate the total cost for each option to expand the fleet and determine the cheapest option. 2. **Option 1 calculations:** - Purchase 6 cars at $18,990 each with 8% discount. - Insurance $600 per car per year. - Driver wages $45,000 total. - Fuel/Maintenance $8,500 per car per year. 3. **Calculate upfront cost for Option 1:** - Discounted price per car: $$18990 \times (1 - 0.08) = 18990 \times 0.92 = 17470.8$$ - Total upfront cost: $$6 \times 17470.8 = 104824.8$$ 4. **Calculate annual running cost for Option 1:** - Insurance total: $$6 \times 600 = 3600$$ - Fuel/Maintenance total: $$6 \times 8500 = 51000$$ - Driver wages: $$45000$$ - Total annual running cost: $$3600 + 51000 + 45000 = 99600$$ 5. **Calculate total cost after 3 years for Option 1:** - Total cost: $$104824.8 + 3 \times 99600 = 104824.8 + 298800 = 403624.8$$ 6. **Option 2 calculations:** - Purchase 4 trucks at $38,990 each with 15% discount. - Insurance $1,200 per truck per year. - Driver wages $50,000 total. - Fuel/Maintenance $11,500 per truck per year. 7. **Calculate upfront cost for Option 2:** - Discounted price per truck: $$38990 \times (1 - 0.15) = 38990 \times 0.85 = 33141.5$$ - Total upfront cost: $$4 \times 33141.5 = 132566$$ 8. **Calculate annual running cost for Option 2:** - Insurance total: $$4 \times 1200 = 4800$$ - Fuel/Maintenance total: $$4 \times 11500 = 46000$$ - Driver wages: $$50000$$ - Total annual running cost: $$4800 + 46000 + 50000 = 100800$$ 9. **Calculate total cost after 3 years for Option 2:** - Total cost: $$132566 + 3 \times 100800 = 132566 + 302400 = 434966$$ 10. **Compare total costs:** - Option 1 total cost after 3 years: $$403624.8$$ - Option 2 total cost after 3 years: $$434966$$ **Answer:** Option 1 is cheaper with a total cost of $$403624.8$$ compared to Option 2's $$434966$$.