why dont they just round prices off instead of saying $3.99, just say it costs $4
omg, do they really think America is that stupid? Wow, thats pretty sad. I figured it had some logical economic reason, not just so people will assume its cheaper.
Anonymous
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I think nearly everyone that has answered so far has been wrong! (Maybe it's ME that's wrong, but I don't think many people are so stupid they don't realise that "$2.99" is basically three dollars!)
It has to do with the amount of tax collected. The government already give businesses a small "break" on taxes they collect on behalf of the IRS. If you sell something for $1.00, you charge your customer $1.07 (if the rate is 7%) and you send 6cents to the IRS. If you price something at 99 cents, you STILL collect 7 cents tax (you charge your customer $1.06).
On a single sale, this increases the difference between what you took from the customer and what you must send to Uncle Sam by a tiny fraction of a penny, but if you sell, say, four million 99c hamburgers, pretty soon you are raking in a huge pot of "unseen revenue"....
Nice work if you can get it!
earny
It's a psychological thing. $3.99 sounds cheaper than $4, so you'll buy the product sooner.
bigguy3214
Steph, marketing is what they call it.Just like gas (petrol), is $2.97 9/10ths per gallon. This came into being in the early years of the 20th century, by a guy named Woolworth. He became very wealthy by using this as a marketing ploy. But it still comes down to saving that penny.
wiess
To trick you into questioning it expenses under it surely does. as an occasion, if a save have been to have a rack that pronounced $.ninety 9, as antagonistic to $a million.00, they might purchase greater, even although there is largely a a million cent difference. it relatively is a sleazy trick and its unlucky that maximum of shops and retailers hotel to something like that, in spite of if it relatively is their livelihood.
Brenda V
because people are always looking for bargains and $3.99 sounds way cheaper than $4.00 even though it is only a one cent difference.