THE HIDDEN CENT A History of Gas Prices and the 9/10 of a Cent
LEGALINSURANCEAGENCY. COM 817.618.6381
We all see it every time we pull up to the pump — the 9/10 at the end of every gas price. We see it, but we don’t really think about it when we pay for our gas. When you see $1.95 gas advertised at your favorite fill-up spot, the price is really $1.96. There's a hidden cent. But why is it there? This fraction of a cent is rooted in American history. In 1792, Congress passed the Coinage Act to standardize American currency. As part of the act, fractions of a cent were established. For instance, there was the 1/1,000 of a dollar, which is the equivalent of 1/10 of a cent. This was also called the “mill.” In the early days of America, the mill was a regular part of day-to-day transactions, but it was slowly phased out. It did, however, remain part of various types of utility billing (some electricity companies still use fractions of a cent), tax assessments, and investment stocks. In the 1930s, the mill became a normal part of gas pricing. It all had to do with the Revenue Tax Act of 1932. This allowed for a federal excise tax on gas that could be added in fractions of a cent. In 1934, the average price of a gallon of gas was about 16 cents. It was more difficult to raise the price by a cent because people were more sensitive to a one-cent increase at that time. Texas-Sized LAUGHS
For reference, 16 cents in 1934 is about $3.13 today, when adjusted for inflation. Today, the average cost of a gallon of gas around the DFW metroplex is about $1.89. The big difference, however, is that it’s much easier to raise prices by a few cents today because it makes less of an impact. There’s a psychology to this pricing, too. In 1934, if you raised the price of gas by 1/10 of a cent, you could still market your gas at 16 cents, with the fraction tacked on. At a glance, it looked like nothing had changed. This is the same reason why many items' prices end in 99 cents. Most people make buying decisions based on the first number — not what comes after the decimal. Eventually, it became easier for oil companies to raise gas prices and the federal government to raise taxes on gas as people got accustomed to it. Over time, ending the gas price with 9/10 became the norm, and now we’re all used to it, so the hidden cent remains.
MONTSERRAT OSWALD
EASY DEVILED EGGS
Inspired by TasteOfHome.com
While the kids hunt for Easter eggs in the yard, whip up this easy deviled egg recipe for a hearty snack that’s sure to satisfy any craving.
INGREDIENTS
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1/2 cup mayonnaise
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Salt, paprika, garlic powder, and pepper, to taste
2 tbsp milk
1 tsp dried parsley flakes
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12 large eggs, hard-boiled Fresh parsley, minced, and paprika for garnish
1/2 tsp dill weed
1/2 tsp fresh chives, minced 1/2 tsp ground mustard
DIRECTIONS
1. In a large bowl, combine mayonnaise, milk, parsley flakes, dill, chives, mustard, salt, paprika, garlic powder, and pepper. Mix well and set aside. 2. Cut eggs lengthwise and remove yolks carefully to preserve egg whites. 3. In a small bowl, mash yolks. 4. Mix mashed yolks with mayonnaise mixture. 5. Spoon or pipe the mixture back into the egg whites. 6. Garnish with fresh parsley and paprika. Refrigerate before serving.
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