Many Firms Use Odd Pricing-Charging Prices Such as

question 2

Multiple Choice

Many firms use odd pricing-charging prices such as $.99 instead of $1.00 and $9.99 instead of $10.00.One reason for this pricing strategy is that consumers will somehow believe that the difference in price appears to be greater than it actually is.Researchers conducted consumer surveys to determine whether this is actually the case.What was the result of these surveys?

• A)The surveys found that small differences in price cause small differences in quantity demanded. There is no evidence that odd pricing makes economic sense.
• B)Although the results were not conclusive, there is some evidence that odd pricing makes economic sense.
• C)The surveys found indifference regarding this strategy among most consumers, but hostility among other consumers. The latter group resented what they viewed as an attempt to fool them into buying products with odd prices. Researchers concluded that odd pricing is counterproductive.
• D)The survey results were inconclusive because most consumers gave unreliable responses to the survey questions.

---

Definitions:

Volcanic Gas

Gases emitted from a volcano, including water vapor, carbon dioxide, sulfur dioxide, hydrogen sulfide, and other volcanic gases.

Convergent

Pertaining to areas where tectonic plates move towards each other, often resulting in mountain building or subduction.

Divergent

Relates to a tectonic boundary where two plates move away from each other, leading to the creation of new crust.

Transform

In geology, referring to a boundary between two tectonic plates where they slide past each other horizontally.