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Thinking In GPM Can Overcome MPG Illusion

“How many miles can I drive on a gallon of gasoline?”

“How many gallons of gasoline do I need to travel 10,000 miles?”

Is there anything fundamentally different in these two questions?

Consider the following examples:

Let’s say you drive 10,000 miles in a year on an average. If you have a car that gives you 10 miles-per-gallon (MPG), then you would need
1,000 gallons of gas every year. If the price-per-gallon is $3, then you would spend $3,000 in a year on gas.

Now, if you changed to a car that gives you 20 MPG, then you would get twice as many miles per gallon, costing you 500 gallons, and so you would spend $1,500 per year on gas.  And if you bought a car that gives you 40 MPG, then you would spend $750 per year.

As you can see, changing from a car that gives 10 MPG to 20 MPG saves  you about $1500 of gas in a year, but going from 20 MPG to 40 MPG only saves you about $750.

So, if you think in terms of MPG, a car that gives 20 MPG is twice as good as the one that gives you 10 MPG, one that gives 40 is twice as good as the one that gives you 20. But when you look at it from the perspective of cost per mile, or GPM, you save significantly more when you change from 10 MPG to 20 MPG, than when you change from 20 MPG to 40 MPG.

Watch this video from The MPG Illusion guys.

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