June 12, 2012

GOTTA BE APOCRYPHAL, DOESN'T IT?:

Pound for pound 99p is worth every penny (The Daily Telegraph, June 5, Tim Harford)

And yet the perfect point often seems to end in 99p.

Indeed it does. There are three main theories as to why it makes sense to end prices with a "9". The first is an explanation favoured by economists because it works even in a perfectly rational universe. Product prices with 99p endings are difficult to pay for with exact money; the shop assistant will almost always have to make change.

Why is that a good thing?

Because it means the sale must be recorded to open the register. The shop assistant can't just hand over the product and trouser the cash.

Posted by at June 12, 2012 5:26 AM
  

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