Research shows that lowering the price of something by one cent, as in $9.99 instead of $10.00, can be an effective way to make it look cheaper. According to the research of Robert Schindler, who studies the topic of pricing, whether or not is a good strategy to lower the price of an item or service by a cent, comes down to what is being purchased. For everyday goods and services, lowering the price by a cent appeals to the consumer as being a better deal. However, for things that the consumer values quality above cost, lowering the price by a penny is not a good idea because it makes the good or service look too cheap and not as quality.
A summary of Schindler's research can be found here at:
http://www.sciencedaily.com/releases/2011/09/110906144036.htm
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