Currently, it is estimated that an average middle-income family in the United States can expect to spend about $245,000 over 18 years to raise a child. This is from the Department of Agriculture’s annual “Cost of Raising a Child” report.
1. If you adjust for inflation, how much more will an average middle-income family in the United States spend on each child?
2. What are the two largest costs and approximately how many dollars are each? Discuss whether these are fixed, mixed or variable costs and give examples.
3. How much less do larger families, those with three or more children, spend per child than families with two children, (a) in percentage, (b) in current dollars, (c) in inflated dollars?
Krasny, R. (2014). Cost of raising a child in U.S. tops $245,000, USDA says. Reuters.com, Aug. 18 (Retrievable online at http://www.reuters.com/article/2014/08/18/us-usa-economy-children-idUSKBN0GI1DJ20140818)