So what are the variable costs of going to the car wash?
- The car wash is 25 miles away so the round trip will take me 2 gallons of gas at $3.10 per gallon for a total of $6.20.
- It will take a half hour to drive one way to the car wash. I will probably spend half an hour waiting for my truck to be washed. So it will cost me one and a half hours. Assuming the opportunity cost of my labor is $6 per hour (what I could earn moving dirt), the total opportunity cost of my time is $9.00.
- There is a high probability that the car wash will not be to my satisfaction. While they will wash off the top layer of grim, I doubt that will shine my wheels and tires, scrub the bugs off the grill, and wash my windows properly. Therefore, I will have to wash my truck again when I get home. Assume it takes an hour (at an opportunity cost of $6 per hour) and I use $1 worth of supplies to wash my truck for a total of $7.00.
So the total variable costs of going to this car wash is $6.20+$9.00+$7.00 for a total of $22.20. I would be willing to pay $10 to have my truck spotless.
Needless to say, I won't be going to this car wash.