Doing the math …

Standard

When you talk about math, most people think of arithmetic. But most math today isn’t arithmetic. Not that it is always highly complex, but the real math, whether in science or economics, always has an extra twist, an extra layer, that you don’t expect from arithmetic.

I took a vacation day Monday. Betsy also ended up with the day off. So we took a date to Ikea. We got there in the morning before the store opened, and dined in their cafe on the ninety-nine cent breakfast.

Ikea Receipt

Of course, we had to have a cinnamon bun — split one — for an extra dollar. My tea was free, and Betsy’s soda was $1.49. So it came to $4.73 — $4.43 before tax.

Now, if you look at the receipt to the right, you will notice that we didn’t pay $0.99 for our breakfast — we paid $1.00. I didn’t complain, but I observed the same to Betsy.

That observation led me to add up the items: $2 for the breakfasts, free tea, $1 for cinnamon bun, and $1.49 for soda added up to $4.43. It was six cents short.

Then right below, it mentioned sales tax of $0.24 and tax included of $0.06. Betsy and I surmized that the extra penny on the breakfast must bit tax included, but weren’t sure how the other four cents showed up.

But this led to the whole question of arithmetic vs. economics mathematics. And this leads to the fact that this blog, titled Be Swift, Be Precise, is often, seemingly, neither. We can be swift, or precise, about certain details of an example like our Ikea breakfast, but because they are a part of a larger, dynamic system, our comments might be neither swift nor precise about the system as a whole. (Seems like I love italics today.)

Betsy made the comment that she didn’t think the cost of our breakfast made Ikea any money. She even ventured that the price might cover the cost of the food, but not the cost of the employees.

Betsy’s part-time job is at McDonalds. I noted to her that McDondals make its money on food; Ikea does not make its money on food. So why does Ikea have a food service? They figure that people coming for breakfast, or lunch, or dinner, earns them more money elsewhere in the store. It is an allocation of costs question.

I remember a WKRP in Cincinnati comment, where the owner of the station talked about how plusses and minuses can lead to greater pluses that just all plusses. That comment related more to taxes, but even without taxes the comment has merit. But it is something that the non-business person often misses in their arithmetic-only world.

The non-business person looks at a product or service they are buying, and only thinks of the direct items involved in it to decide the value of it, and whether they think they are being over or under charged. But they don’t recognize the entire system behind it that funds and creates and supports it.

The same thing is true of the government programs. People seldom consider all the other support that makes them possible. Unlike business, the cost/benefit ratio, and the allocation of cost, works in the opposite direction from that of business, which makes it seem free, and impressive, but actually makes it cost more.

So, doing the math isn’t arithmetic, but it also isn’t calculus. Doing the math is a life science, a living entity.

So, my request is, stop doing arithmetic, and do the math.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s