Where does the one cent go?
I was checking apple's AppStore and it made me wonder why don't they ever make it an even dollar? Why .99 not one buck, why 19.99 not 20? I'm not American and were I come from we don't do this but it seem every where in USA "starbucks electronics and etc." where is the one cent?
Best Answer:
Everyone is correct, but I remember something else. I think it had to do with keeping track of the money. If anyone else know the other reason, please list it.
It is a psychological ploy to win you to buy the item. All in all, there is no existing difference between an item that costs $19.99 or $20.00, but in your mind, you look at that and unconsciously you think how much cheaper that item is. Research has be done in the marketing field for years... decades even... and this is actually a intensely effective technique. It is not often that you see an item listed for an even dollar amount, or for anything excluding an amount not ending in .09 cents.
It's a time-honored method of making things look smaller amount expensive than they really are. If you think 99 cents sounds a lot like a dollar, you aren't alone, but look at the even more extreme shield of gasoline, which is priced with 9/10 of a cent tags to try to make it look a penny a gallon cheaper than it really is.
It go way back. Someone at one point came up beside a great marketing ploy. Instead of $20, they charge $19.99. It sounds like a lot more saving than it really is. You're not paying $20 for the item, so it sounds close to such a bargain. And, many places take even a short time further and price their items at $19.95.
they do it so the consumer thinks the product is cheaper. when they price something at $19.99, the consumer usually see $19, and they don't even think about the products price being really $20
