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.