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In order to flourish, business must operate at a profit. As the margin of profit is daily becoming smaller, costs must be analyzed so that economies can be effected. As a lack of uniformity exists in the methods of arriving at the cost of operation, a brief outline is given of the items that enter into the totals from which operating costs are calculated and also of what constitutes the economic life of a motor vehicle. Selection of the correct type and size of vehicle is of paramount importance; and standardization of the various makes will result in better operation, more efficient inspection, and more economical repair and upkeep. Having then determined the cost of operation of a vehicle, a decision must be made as to the basis on which its economic life can be computed.