Gas prices are once again on the rise and the effects on students' wallets could be surprising.
According to a new study done by the Ball State Center for Business and Economics Research, gas increasing by just $1 dollar a gallon or $25 dollars a barrel could do more than just destroy students' paychecks.
The results of the study found that increasing gas prices could lead to depressed economic activity by 2 percent, increase the unemployment rate by 1.3 percent and lower state tax revenue by about $68 million.
Michael Hicks, director of the Center for Business and Economic Research, was in charge of the study and created a mathematical model consisting of 80 different equations to predict the effects of the rising gas prices.
"I had been keeping my eye on gas prices for a long time," he said.
Hicks used his own model with data from the U.S. Department of Commerce, the national input and output model, historical data on unemployment and gas prices from 1978 to now to estimate the impact of gas prices on peoples' every day lives.
The study shows the economic activity slowing down because it takes gas to transport goods and gas is used in manufacturing.
The increase in gas prices also increases the cost of goods, which reduces consumer spending, Hicks said.
"With gas prices rising, goods will be more expensive and less people will buy them, and therefore, companies will make less of that good and need less workers," he said.
"I see gas prices increase all the time, but I never see my pay increase along with it," sophomore criminal justice major Marcie Kress said.
Hicks said he does not see gas prices reaching the $4 dollar mark again and even if it does, he does not see a recession resulting from it.
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