if the truck drivers find out they must remain at the weigh station longer than 20 minutes on the average, they will start taking a different route or traveling at night, thus depriving the state of taxes. the state of california estimates it loses $15,000 in taxes per year for each extra minute that trucks must remain at the weigh station. a new set of scales would have the same service capacity as the present set of scales, and it is assumed that arriving trucks would line up equally behind the two sets of scales. it would cost $100,000 per year to operate the new scales. should the state install the new set of scales? what is the net saving per year?

Respuesta :

To determine whether the state should install the new set of scales, we need to calculate the net saving per year.

To do this, we need to subtract the cost of operating the new scales ($100,000 per year) from the amount of money the state would save in taxes by reducing the time trucks spend at the weigh station.

If the new scales would reduce the time trucks spend at the weigh station by even one minute per year, the state would save $15,000 in taxes. Therefore, the net saving per year would be $15,000 - $100,000 = -$85,000.

Since the net saving per year is negative, it would not be a good decision for the state to install the new set of scales. The state would be losing money by doing so.

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