Car Comparison Project By Stan Back Algebra One Ms. Hardy

Which Car is a better value overall Which Car is a better value overall? A foreign make SUV or a domestic make SUV?

Toyota Highlander SUV new priced at $32,476

Dodge Durango SUV new priced at $45,871

The Dodge is more expensive as a new vehicle – does that mean it is a better quality SUV and thus a better value? Or is the Toyota a better value because it is less expensive?

Let’s look at the data Age of vehicle Toyota Highlander SUV Dodge Durango SUV New $32,476 $45,871 1 $29,228 $39,449 2 $26,306 $33,926 3 $23,675 $29,177 4 $21,3078 $25,092 5 $19,177 $21,579 6 $17,259 $18,558

What does this data tell us? Let’s look at graphs of the data.

The Value of Dodge Durango SUV over time Value of Car in dollars Age of car in years

The Value of Toyota Highlander SUV over time Value of Car in dollars Age of car in years

Both cars depreciate in value. What does that look like mathematically Both cars depreciate in value. What does that look like mathematically? Let’s look at the exponential decay equations that describe the depreciation.

Exponential Regression Function Equations from our data* Dodge Durango SUV F(x) = 45871.45 (0.86)x Toyota Highlander SUV F(x) = 32,476.59(0.90)x *rounded to the nearest hundredth

How do we find the depreciation rate? We can calculate the depreciation rate from the base of these equations. Turn the base into a percent, then subtract it from 100% to find the depreciation rate.

Depreciation Rates Dodge Durango SUV Turn into percent: 0.86 = 86% 86% - 100% = -14% yearly depreciation Toyota Highlander SUV Turn into percent: 0.9 = 90% 90% - 100% = -10% yearly depreciation

What do the depreciation rates tell us? The Toyota Highlander appears to be a better value over time as it depreciates more slowly with a rate of 10% compared to the faster depreciation rate of 14% for the Dodge Durango.

When do the two cars have the same value? Let’s look at both depreciation equations on the same graph and see when they have the same value by using the intersect option on the calculator.

When do the cars have the same value? Value of Car in dollars Age of car in years

When do the cars have the same value? The two cars have the same value after a little more than 7 ½ years when they are both worth about $14588.32 After that the Toyota will have a greater value than the Dodge.

What other factors can we consider when comparing which car is the better value? Toyota Highlander SUV Fuel Economy city 19 mpg, highway 25 mpg Maximum Seating 8 passengers V6 engine

What other factors can we consider when comparing which car is the better value? Dodge Durango SUV Fuel Economy city 14 mpg highway 23 mpg Maximum Seating 7 passengers V8 engine

Conclusion Which Car is a better value overall? A foreign make SUV or a domestic make SUV? You will address your original thesis question by comparing ALL the data you collected. Include the “new” prices of each vehicle, the “depreciation rate”, the value of the cars in 10 years AND the other factors you researched (fuel economy, engine size, luggage room, etc). Then make a decision –which do you think is a better deal considering all the factors?