Many consumers are willing to pay $100 for a perfume that contains $10 worth of scent because the perfume is from a well-known brand. What does this image pricing suggest about these consumers?
A) They process prices from left to right.
B) They use the price as an indicator of quality.
C) They are rounding up the price.
D) They are remembering an external frame of reference.
E) They are breaking the price into smaller units.

Question

Quizplus · Accepted Answer

The fact that consumers are willing to pay a higher price for a well-known brand suggests that they are using the price as an indicator of quality. They believe that the higher price is justified because the brand is known for its quality and reputation.

Many Consumers Are Willing to Pay $100 for a Perfume