Hello and welcome to the weekend!
On Wednesday, the New York Times Magazine ran a story called, “Why Do Americans Stink at Math?” Much of the article sought to answer the titular question with anecdotes and statistics, but buried in the middle there was this choice quote:
One of the most vivid arithmetic failings displayed by Americans occurred in the early 1980s, when the A&W restaurant chain released a new hamburger to rival the McDonald’s Quarter Pounder. With a third-pound of beef, the A&W burger had more meat than the Quarter Pounder; in taste tests, customers preferred A&W’s burger. And it was less expensive. A lavish A&W television and radio marketing campaign cited these benefits. Yet instead of leaping at the great value, customers snubbed it.
Only when the company held customer focus groups did it become clear why. The Third Pounder presented the American public with a test in fractions. And we failed. Misunderstanding the value of one-third, customers believed they were being overcharged. Why, they asked the researchers, should they pay the same amount for a third of a pound of meat as they did for a quarter-pound of meat at McDonald’s. The “4” in “¼,” larger than the “3” in “⅓,” led them astray.
The story doesn’t link to a study or a source, but I wouldn’t be surprised to find such an anecdote in a long-forgotten biography or an introductory marketing course textbook next to other urban legends like why the Chevy Nova didn’t take off in Latin America (No va means “doesn’t go” in Spanish” implying Latin Americans must have spent hours at a time confusedly staring at dealerships wondering why they would sell cars that don’t move).
And the even more important question: How many millions of dollars could I make if I sold a 1/5-pounder burger?
It seems like it would be difficult to prove conclusively, and yet is too good a story not to pass on because it fulfills a stereotype we already hold that makes us feel better about ourselves. One of these seems to make the rounds every week; why, just last week, everyone was beside themselves that everyone Instagramming their food makes us bump into waiters and has doubled the time we spend in restaurants.
The personal finance angle from the rest of the story is that we should all be better at math if we don’t want to lose money. In particular, if you’re an American who eschews the innumerable other potential factors and makes food buying decisions along a single dimension — meat per dollar — then make sure you understand fractions!
And enjoy the rest of your weekend 🙂