If you tried to block out everything you ever learned in your college Economics class, the Misery Index was probably the first thing you (thankfully) forgot. If so, here is a quick refresher: The Misery Index is an economic indicator that measures how citizens of a specific geographical area (usually a country) are doing economically. Created by economist Arthur Okun in the 1960s, the index works by adding the seasonally-adjusted unemployment rate to the annual inflation rate. Harvard Economist Robert Barro later spiced up the recipe by adding the delta between the actual and trend rate of GDP growth. To this day, the rather colorfully-named Index is used to get a quick read on how the average citizen is fairing.

Candidates studying for that basket of sunshine we call the CPA Exam have long struggled with balancing the cost, study time required, and challenges with passing the CPA Exam, so I decided to create a new “Misery Index” for CPA Exam candidates, calculated as M=C+E+S (where M = Misery Index, C = Course Cost, E = Exam Fees, and S = Study Hours. Let’s break down each part of the formula:

C = Course cost

The first measurement is course cost. Not only is this often a sizeable investment, but the costs can quickly escalate depending on how long you take to pass (most courses require you to extend the course for a fee if you take more than 18 months to pass).

To calculate this measurement, take the actual cost of your review course and divide it by 1,000. For the sake of this example, we used the price of the most widely-used course (Becker). So the calculation is $3,393/1,000 (or 3.39).

E = Exam fees

The second measurement in my index is the total cost of exam fees you’ll pay, weighted more heavily when sit for one of the four sections more than once:

Sections           Weighted Score

4                                  1.0

5                                  1.25

6                                  1.5

7                                  2.0

8                                  2.5

9                                  3.0

10                                4.0

10+                              5.0

So, if you pass all four exam sections on the first sitting, you’ll get a weighted exam fee score of 1.0. If you require six exam sittings to pass all four sections—which is average—the weighted exam fee score is 1.5. So, if someone paid $3,393 for a CPA Review Course and sat for the CPA Exam a total of six times, their weighted score for review courses costs and exam fees would be 3.39 and 1.5, respectively, giving them a C + E total of 4.89.

S = Study hours

And of course, what is a CPA Exam experience without study? Lots and lots of study. This is where the math gets fun. Of course, you only want to sit for each CPA Exam section one time, hopefully spending no more than 100 hours of study per exam section, meaning no more than 400 hours of study time in the aggregate.

So, to calculate this measurement, take the total hours of study time you expect to spend across all sections and divide by 400.

For the sake of this example, we used the average that most CPA Review providers suggest candidates study (225 hours per section), which totals 900 study hours. 900 divided by 400 equates to 2.25 for the S portion of the index.

So, if you take C+E+S (3.39 + 1.5 + 2.25 in this example), you’d have an Exam Misery Index of 7.14.  The lower the score, the better.

Real-world examples:

If a CPA Exam candidate spends $1,599 on CPA Exam Review materials for a C score of 1.59, sits for the exam a total of seven times for an E score of 2.0, and spends 1,200 hours of total study (which, unfortunately, would be fairly accurate) for an S score of 3.0, they’d end up with a CPA Exam Misery Index of 6.59.

Then, for one final real-world example, there are many newly-minted CPAs who used Surgent CPA Review’s adaptive technology, passed all four sections in one sitting, and studied fewer than 100 hours per part. These candidates have a C score of 1.59, an E score of 1.0, and an S score of 1.0 (or less), making their CPA Exam Misery Index just 3.59!

What is your CPA Exam Misery Index score? If it’s above a 5 and you don’t love being in the company of misery, you might want to consider a different CPA Exam Review course!