How is 'average' price of gas calculated?

albert_135May 10, 2007

If I fill my tank, 30gal at $3.50 and the grandkids in Arkansas buys 10gal at $2.90 is the "average":

I ((30*3.50) + (10*3.40))/50=3.35 or is it

II (3.50 + 3.40)/2 = 3.45?

The "average" reported by the media seems rediculiously low to some of us Western US peple. Like they averaged an Arkansas price and a California price without taking into account that the California driver buys 3 times as much.

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albert_135

Please disregard, sorry.

Let me start over.

If I fill my tank, 30gal at $3.50 and the grandkids in Arkansas buys 10gal at $2.90 is the "average":

I ((30*3.50) + (10*2.90))/50=3.35 or is it

II (3.50 + 2.90)/2 = 3.20?

The "average" reported by the media seems rediculiously low to some of us Western US peple. Like they averaged an Arkansas price and a California price without taking into account that the California driver buys 3 times as much.

    Bookmark   May 10, 2007 at 4:56PM
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john_g

The price of gas, is the price of gas, the volume that a particular customer purchases is irrelevant to the "average price".

Now if your talking about average daily/weekly/monthly expense there are just so many variables that you get into the old adage, liars figure and figures lie. Anyone can use just the parameters they want to try and make their point.

Use the price of one gallon of fuel per station to compute average price. Now when it comes to comparing, take into account cost of living for the area. Here a $100,000 house might be a struggle to own on a combined income of $50K a year. Where you are at, that same house, and income level comparison "might be", a $250,000 home and a $125K combined income. Now if we are paying $3.00 a gallon for gas, and you are paying $3.10 it could be shown that your getting it cheap!

    Bookmark   May 11, 2007 at 6:37AM
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