Cost Allocation: An Application of Fair Division.

Splitting the cost equally is unfair lthough the subject of cost allocation has been extensively discussed in the literature of political economics, it has been generally neglected in math ematical literature. However, cost allocation affords a practical extension of fair-division techniques-one that is readily accessible to secondary school stu dents and that gives them a simple yet powerful application of mathematics to real-world problem solving. A study of the concepts and the mathemat ics involved in cost allocation is most appropriate in a discrete mathematics course or a modeling course, but a case can be made for including this topic in other courses, as well. This article presents a typical cost-allocation problem with possible solu tions and includes suggestions for presenting simi lar problems in the classroom. The basics of the problem follow closely from Young (1994).