16 April 2008

It's pronounced: Four Dollars

I bought gas yesterday and it was $3.99 per gallon for the medium grade 89. Since I've never paid four bux for a gallon of gas, I wanted to try it out. Don't forget the 9/10ths of a cent that is attached to every price you've ever paid. What other industry consistently prices that way?

How about this:
When I was a kid, we drove an RV to the Grand Canyon. I was part time co pilot and navigator. This included keeping a logbook of our mileage, gas cost, etc. for the trip. We paid a high of 74 cents outside of Fagstaff, AZ and I still remember that the gas was priced in 10-cent increments.

When I began driving, gas was $1.27 or so. I knew it would be $2.00 before long. And, it was. As gasoline prices climbed to $3.00 per gallon, there were still 10-cent increments. $1.27 for 87, $1.37 for 89, $1.47 for 91 octane became $3.27, $3.37, $3.47 per gallon. Sure, it is sometimes a 12-cent jump between grades, but the range remains consistent over the years. How has the cost of 2 octanes remained the same for 30 years while the gasoline increased?



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