Pricing a product at $399.99 instead of $400 to make the customer view the price as in the $300 range instead of the $400 range is an example of which of the following?
A) price lining
B) odd-even pricing
C) minimized pricing
D) red-line pricing

Question

Quizplus · Accepted Answer

This is an example of odd-even pricing, where the price is set just below a round number to make it seem more attractive to customers. The strategy is based on the idea that customers tend to process prices more emotionally than rationally, and perceive prices ending in 9 as being cheaper than they really are. Price lining refers to offering a range of products at different price points, minimized pricing involves minimizing costs to offer low prices, and red-line pricing refers to pricing above the market average to convey a premium or exclusive image.

Pricing a Product at $399