May 07, 2007

Do You Use Algebra In Your Everyday Life? How About Multichannel Forensics?

You probably recall your teacher telling you that you'd use algebra in your everyday life. That seemed like a stretch, especially when trying to solve the equation 4x - 3 = 13.

Kids and adults may feel the same way when taught Multichannel Forensics. Yet, there are all of these interesting things happening in our everyday lives that are well explained by this framework.

Circuit City: You're responsible for selling compact disks. Not many people buy these things anymore. Are customers transferring sales to other departments in your store? Do they still purchase other products in your store? When is the transfer so great that sales per square foot drop below acceptable levels? The same theory can be applied to non-HD 27" tube-based televisions.

Toyota: Are Corolla customers in equilibrium with Hybrid cars? And if so, is the rate increasing to the point where customers will transfer out of one category, into Hybrids? Is there a price point ($5.00 gas) that accelerates transfer?

Safeway: When a customer purchases organic merchandise, how does behavior change? Does that customer exist in equilibrium with traditional brands, or does the customer isolate herself in organic foods? And if the customer isolates herself in organic foods, what does that mean for the products she used to purchase, especially if more customers transfer out of traditional brands?

Comcast: Within the course of ten years, many Americans chose to trust Comcast with HD, Digital and Basic Cable, a DVR, their Telephone Service, and Broadband Internet. Can Comcast forecast a five year sales trajectory by product line, and are there enough new customers available to sustain long-term growth?


  1. In Yahoo! Answers, user SiLv'S asked Why must we learn Math?

    My response was:

    People learn math because math is useful. Most good-paying jobs require some proficiency in math. Even at home, math can be very handy.

    An example will illustrate what I mean. Everyone cares about money, right? Money is measured in... ? Numbers, right. And how do we understand numbers... ? Yes: math! Take a look at the price schedule provided by XM Radio on their Web site:

    Go ahead, take a look. Let's assume that you're interested in buying XM's fine service. XM, in that document, says that they are willing to provide service for 1 year, pre-purchased for $142.45. XM also claims that you can "save over 20%" by buying longer amounts of service time, for example by buying a 3 year block of service, again paying up front, for $359.64. Discounting the 1 year price by a measly 5% annually (and you should be able to do much better then this with index funds on the market in the long run), I calculate a present cost for 3 years' worth of XM's 1 year plan to be $344.77. Monthly compounding, which I didn't include, only makes this difference larger.

    Math: How else are you going to understand your world?

  2. Hi Will, thanks for leaving a comment!

    You clearly illustrate that math helps folks save money. That's probably the best way to make math/algebra tangible to folks.


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