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Each month ZV Corp (Zebra Vehicles where all paint jobs are striped) makes 230 A vehicles which get 10mpg, 500 B vehicles which get 20mpg, and 70 C vehicles which get 40mpg. Unfortunately, the government sets a standard where companies must “average” 30mpg [this is called a CAFE law]. Any company that falls short of the 30mpg standard must pay a penalty. The penalty is calculated as $55 times number of vehicles sold each month times the deficit in their average mpg from the 30mpg standard. • Compute ZV Corp’s monthly penalty if the government incorrectly uses (weighted) arithmetic mean to compute average mpg. • Compute ZV Corp’s monthly penalty if the correct (weighted) Harmonic Mean is used. • ZV Corp is beginning to make a D vehicle which gets 75mpg. They estimate initially adding 2 D vehicles to their production each month. Compute their new monthly penalty.
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