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Anonymous A
on May 23, 2020
Global
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Hi i don't understand why we have to multiply 10 not 20 for 'number of miles per trip' in below equation. 

In exhibit 1, average miles per route is 20 right?

  • Cost per trip = (Depreciation per mile + fuel per mile) * number of miles per trip + insurance cost per trip + labour cost
  • Cost per trip = (420k / 300k + 0.5) * 10 + 10,500 / 350 / 10 + 20 * 1 = £61
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Ian
Coach
on May 23, 2020
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate

Hi there,

I'm a bit confused by your question. It looks like you do multiply by 10 (see image below).

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2 comments
Anonymous
on May 23, 2020
Oops my bad. I have change the numbers in my question.
Esmee
on Jul 08, 2020
Hi there! I'd also like to know why we multiply by 10 and not by 20? The average miles per trip is 20 right?
Clara
Coach
on May 25, 2020
McKinsey | Awarded professor at Master in Management @ IE | MBA at MIT |+180 students coached | Integrated FIT Guide aut

Hey there!

Since this is an expert cse, I would recommend you to ping directly the author. He is on PrepL!

Hope it helps!

Cheers, 

Clara

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