Firms Engage in Odd Pricing When They Charge Prices That

question 70

Essay

Firms engage in odd pricing when they charge prices that appear to be less than they really are; for example, charging a price of $4.95 instead of $5.00 and $.99 instead of $1.00.How have researchers tried to determine whether odd pricing is successful in convincing consumers that odd prices are less than they really are?

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Definitions:

Contract Rescinded

The act of legally declaring a contract null and void, as if it never existed, usually due to misinformation, fraud, or mutual mistake.

Sabbath Day

A day set aside for rest and worship according to Jewish, Christian, and some other religions’ traditions, typically observed from sunset on Friday to sunset on Saturday in Judaism and on Sunday in Christianity.

Promissory Estoppel

A legal principle preventing a party from retracting a promise when the other party has reasonably relied on that promise and acted upon it, leading to a detriment.

Reasonable Reliance

Relying on a statement or action in a manner that a reasonable person would consider justified under the circumstances.