## Friday, July 19, 2013

### How Much Does it Cost to be Your Favorite Superhero IRL? Inflation from Different Angles

PERSONAL FINANCE 101

A friend shared these interesting infographics with me:

 How much does it cost to be Batman in real life?

 How much does it cost to be Spider-man in real life?

 How much does it cost to be the Hulk in real life?

 How much does it cost to be Superman in real life?

So it seems that even our favorite superheroes are not immune from the ravages of time--and inflation. Looks pretty bad, doesn't it? But how bad, exactly? How much inflation have our justice friends suffered through in the past several decades?

Say, P is the price of a certain product now, and Px the price of the same product x years ago. The compounded average annual change in price of the product--i.e., the inflation rate with respect to the product--is:

[(Px/P)^(1/x)] - 1

Let's try applying this formula to some of the items in the infographics above (since we can only use the formula for the prices of the same item, we can't use it for Batman's expenses and Spider-man's residence expense, for example).

 Superhero Item Px P From To (Implied) Inflation Spider-man Suit 193 265 1962 2013 0.62% Spider-man Date 780 3,299 1962 2013 2.87% Hulk Undergrad 11,080 183,560 1962 2013 5.66% Hulk PhD 25,430 190,420 1962 2013 4.03% Hulk Psychologist 7,852 15,600 1962 2013 1.36% Hulk Clothing 450 4,160 1962 2013 4.46% Superman Apartment 800 24,000 1938 2013 4.64% Superman Eyeglasses 10 95 1938 2013 3.05% Superman Suit 30 1,510 1938 2013 5.36% Superman Subway fare 36 1,344 1938 2013 4.94%

Given that the inflation rate in different parts of the world has behaved this way since 1986 (have purposely excluded the 50% jump in prices in the Philippines in 1984):

And you hear statistics like these from CHEd:

CHEd said that on the average, tuition would increase by P37.45 per unit or by 8.5 per cent, the lowest percentage increase in the last 10 years.

The national average increase in school fees is P194.62 or by 7.58 per cent, according to CHEd.

Cost-wise, being a superhero may not be so bad, after all. Large changes in price over a long period of time may seem much at first glance, but really reasonable upon closer inspection.

Although it's also perfectly understandable to interpret this as "reasonable annual changes in price translate to insane price differences over a long period of time." It's just a matter of perspective, really. And compounding completely playing tricks with our minds.