It’s a marketing thing. The price looks like $2.74, but in reality, for all intents and purposes, it’s $2.75. And in some areas with heavy competition, one or two cents actually does matter. The consumer will go to the place with the $2.74 sign even though the price is (essentially) the same.
The actual reason: Gasoline prices in the United States were customarily displayed in cents per US gallon (about 3.8 litres). This means the sign originally read something like “15”, which meant $0.15 per gallon. Since the US has also a long history of pricing things in 9 or 99 (due to the psychological effect of such pricing), many service stations appended the extra 9/10 at the end to indicate 9/10 of 1 cent, which was a more meaningful price difference when the price of fuel was 15 or 25 cents and not two or three dollars. Legally, although the smallest cash denomination in the US is one cent, the US dollar can still be nominally divided into 1,000 “mills” for accounting purposes.
Inflation has caused the price of gasoline to rise, and when it passed $1 per gallon, service stations continued the same pricing traditions by just adding a third digit to the number. When digital price displays came on the scene, many of them continued to just display a three-digit number with the traditional 9/10 at the end, i.e. 123 9/10
New displays seem to have gotten rid of this tradition and just display a three-digit decimal number, i.e. 3.45 or 4.56.
Not sure why they show it like that, it might be a design choice. Where I live, it’s often put as decimals, with the last digit smaller than the others:
So the price of unleaded is 2.74 + 9/10 of a cent?
Isnt that just 2.749? Why show it as a fraction?
Sorry, I’m really confused.
Edit: Oh, is this to accommodate other fractions like 3/4 or 7/9?
It’s a marketing thing. The price looks like $2.74, but in reality, for all intents and purposes, it’s $2.75. And in some areas with heavy competition, one or two cents actually does matter. The consumer will go to the place with the $2.74 sign even though the price is (essentially) the same.
The actual reason: Gasoline prices in the United States were customarily displayed in cents per US gallon (about 3.8 litres). This means the sign originally read something like “15”, which meant $0.15 per gallon. Since the US has also a long history of pricing things in 9 or 99 (due to the psychological effect of such pricing), many service stations appended the extra 9/10 at the end to indicate 9/10 of 1 cent, which was a more meaningful price difference when the price of fuel was 15 or 25 cents and not two or three dollars. Legally, although the smallest cash denomination in the US is one cent, the US dollar can still be nominally divided into 1,000 “mills” for accounting purposes.
Inflation has caused the price of gasoline to rise, and when it passed $1 per gallon, service stations continued the same pricing traditions by just adding a third digit to the number. When digital price displays came on the scene, many of them continued to just display a three-digit number with the traditional 9/10 at the end, i.e. 123 9/10
New displays seem to have gotten rid of this tradition and just display a three-digit decimal number, i.e. 3.45 or 4.56.
Huh interesting. Thank you for the insight.
Not sure why they show it like that, it might be a design choice. Where I live, it’s often put as decimals, with the last digit smaller than the others:
Ah yes, the “round to 9” method. That one is a worldwide plague.
I’ve seen displays with the lower sized digits, but usually it’s the cents: €149.99
Adding fractions of a cent to a price display is just so… avaricious. (I’m sure there’s a more common word for this but I could find it)
That looks like 1799 or 35263