Postage Cost

By: Ginger Rhodes

 

Problem: The following data is based on the first class letter postage for the US Mail from 1933 to 2002. Can you believe stamps used to cost 2 cents? Plot the data and develop a prediction function.

 

 


 


 


When will the cost of a first class postage stamp reach $1.00? When will the cost be 64 cents? How soon should we expect the next 3 cent increase? All of these questions can be answered by finding the best fit equation. This graph looks like an exponential growth, y = a bx, where x will be the year and y will be the rate.

 

 

Now, how can this exponential equation help answer those previous questions? Let’s look at a spreadsheet with some additional values.

 

Year

Rate (in cents)

Exponential Equation

 

 

 

1919

2

1

1932

3

2

1958

4

6

1963

5

8

1968

6

10

1971

8

11

1974

10

12

1975

13

13

1978

15

14

1981

20

16

1985

22

19

1988

25

21

1991

29

24

1994

32

27

1997

33

30

1999

34

33

2002

37

37

2004

?

40

2006

?

43

2008

?

46

2010

?

50

2015

?

61

2016

?

64

2025

?

91

2026

?

95

2027

?

99

2028

?

103

 

From this table of values we can predict the next 3 cent increase to occur next year. Stamps will cost 64 cents in 2016 and over a dollar in 2028!! We will have to wait and see how accurate our prediction model is.

 

 

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