Chapter 9 Formulas

Question 1

Sticker Price

Answer 1

Base Price + Options + Destination Charge

Question 2

Dealer’s Cost

Answer 2

(Base Price x Dealer’s Percent) + (Options Price x Dealer’s Percent) + Destination Charge

Question 3

Average Retail Price

Answer 3

Average Retail Value + Additional Options - Options Deductions - Milage Deductions

Question 4

Annual Base Premium

Answer 4

Liability + Comprehensive + Collision

Question 5

Annual Premium

Answer 5

Base Premium x Driver Rating Factor

Question 6

Cost per Mile

Answer 6

(Annual Variable Cost + Annual Fixed Cost)/Number of Miles

Question 7

Steps for finding the Cost per Mile (if the total annual cost isn’t clearly stated)

Answer 7

1. Find depreciation
   (Original Price-Today’s Price)/ Number of Years Owned
2. Find the total annual cost
   annual variable cost + insurance per yr + registration fees + depreciation
3. Find Cost per Mile
   Use formula for Cost per Mile

Question 8

Total Lease Cost

Answer 8

(Number of Payments x Amount of Payment) + Deposit + Title Fee + License Fee