Why do gas prices always end in nine-tenths?
It is for exactly the same reason that almost all retail products are priced in this fashion: it doesn’t look as expensive as it is to everyone. If, for example, a person looks at a pricetag of $9.95, the numbers preceeding the decimal point tend to be retained by the consumer – the price is effectively rounded down. Therefore, $9.99 becomes $9. A car priced at $19,995 becomes $19,000. A lot of people don’t think this way and they round that $9.99 to $10 and that $19,995 to $20,000, but enough mentally round down that retailers continue to follow the practice. Where I live, gas prices don’t end in the .9 fraction any more than they do any other number. The price difference between one gas station selling gas at 82.6 /litre and one down the street selling it at 82.5 /litre is insignificant – a big fat nickel for a complete fill with my car. At that rate, it would take me about 9 months to save a lousy buck.
