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#4: Post edited by user avatar Chgg Clou‭ · 2023-03-22T00:20:06Z (about 1 year ago)
  • #### I can prove [the Rule of 100](https://www.nickkolenda.com/psychological-pricing-strategies/) algebraically, below. But my school kids are hankering after intuition, and a plainer explanation.
  • >![](https://i.imgur.com/omIEqHg.png)
  • >
  • > ## Follow the Rule of 100
  • >
  • > Should discounts be **percentages** or **absolutes**?
  • >
  • > Consider a \$150 blender. Should you offer 20% off? Or an equivalent \$30 off?
  • >
  • > Answer:
  • >
  • > - **Over \$100?** Give absolutes (e.g., \$30)
  • > - **Under \$100?** Give percents (e.g., 20%)
  • >
  • > In both cases, you show the higher numeral. For a \$50 blender, 20% off is the same as \$10 off — yet 20% is more persuasive because it’s a higher numeral. For a \$150 blender, the absolute discount (\$30 off) is a higher numeral (González, Esteva, Roggeveen, & Grewal, 2016).
  • >
  • > #### References
  • >
  • > González, E. M., Esteva, E., Roggeveen, A. L., & Grewal, D. (2016). Amount off versus percentage off—when does it matter?. Journal of Business Research, 69(3), 1022-1027.
  • Let d = discount, p = price. Then $d, p > 0$ because [there is no free lunch](https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as_a_free_lunch) and [the quotation](https://www.nickkolenda.com/psychological-pricing-strategies/) is expatiating on discounts. Then
  • \$ off vs. % off $\iff p - d \quad \text{ vs } \quad p - (d/100)p \iff -d \quad \text{ vs } \quad -dp/100 \iff 1 \quad \text{ vs } \quad p/100 \iff p \quad \text{ vs } \quad 100. $
  • #### I can prove [the Rule of 100](https://www.nickkolenda.com/psychological-pricing-strategies/) algebraically, below. But my school kids are hankering after intuition, and a plainer explanation.
  • >![](https://i.imgur.com/omIEqHg.png)
  • >
  • > ## Follow the Rule of 100
  • >
  • > Should discounts be **percentages** or **absolutes**?
  • >
  • > Consider a \\$150 blender. Should you offer 20% off? Or an equivalent \$30 off?
  • >
  • > Answer:
  • >
  • > - **Over \\$100?** Give absolutes (e.g., \$30)
  • > - **Under \\$100?** Give percents (e.g., 20%)
  • >
  • > In both cases, you show the higher numeral. For a \\$50 blender, 20% off is the same as \\$10 off — yet 20% is more persuasive because it’s a higher numeral. For a \\$150 blender, the absolute discount (\\$30 off) is a higher numeral (González, Esteva, Roggeveen, & Grewal, 2016).
  • >
  • > #### References
  • >
  • > González, E. M., Esteva, E., Roggeveen, A. L., & Grewal, D. (2016). Amount off versus percentage off—when does it matter?. Journal of Business Research, 69(3), 1022-1027.
  • Let d = discount, p = price. Then $d, p > 0$ because [there is no free lunch](https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as_a_free_lunch) and [the quotation](https://www.nickkolenda.com/psychological-pricing-strategies/) is expatiating on discounts. Then
  • \\$ off vs. % off $\iff p - d \quad \text{ vs } \quad p - (d/100)p \iff -d \quad \text{ vs } \quad -dp/100 \iff 1 \quad \text{ vs } \quad p/100 \iff p \quad \text{ vs } \quad 100. $
#3: Post edited by user avatar Chgg Clou‭ · 2023-03-22T00:18:14Z (about 1 year ago)
#2: Post edited by user avatar Chgg Clou‭ · 2023-03-22T00:17:19Z (about 1 year ago)
  • #### I can prove [the Rule of 100](https://www.nickkolenda.com/psychological-pricing-strategies/) algebraically, below. But my school kids are hankering after intuition, and a plainer explanation.
  • >![](https://www.nickkolenda.com/wp-content/uploads/2016/09/Follow-the-Rule-of-100-1.png)
  • >
  • > ## Follow the Rule of 100
  • >
  • > Should discounts be **percentages** or **absolutes**?
  • >
  • > Consider a \$150 blender. Should you offer 20% off? Or an equivalent \$30 off?
  • >
  • > Answer:
  • >
  • > - **Over \$100?** Give absolutes (e.g., \$30)
  • > - **Under \$100?** Give percents (e.g., 20%)
  • >
  • > In both cases, you show the higher numeral. For a \$50 blender, 20% off is the same as \$10 off — yet 20% is more persuasive because it’s a higher numeral. For a \$150 blender, the absolute discount (\$30 off) is a higher numeral (González, Esteva, Roggeveen, & Grewal, 2016).
  • >
  • > #### References
  • >
  • > González, E. M., Esteva, E., Roggeveen, A. L., & Grewal, D. (2016). Amount off versus percentage off—when does it matter?. Journal of Business Research, 69(3), 1022-1027.
  • Let d = discount, p = price. Then $d, p > 0$ because [there is no free lunch](https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as_a_free_lunch) and [the quotation](https://www.nickkolenda.com/psychological-pricing-strategies/) is expatiating on discounts. Then
  • \$ off vs. % off $\iff p - d \quad \text{ vs } \quad p - (d/100)p \iff -d \quad \text{ vs } \quad -dp/100 \iff 1 \quad \text{ vs } \quad p/100 \iff p \quad \text{ vs } \quad 100. $
  • #### I can prove [the Rule of 100](https://www.nickkolenda.com/psychological-pricing-strategies/) algebraically, below. But my school kids are hankering after intuition, and a plainer explanation.
  • >![](https://i.imgur.com/omIEqHg.png)
  • >
  • > ## Follow the Rule of 100
  • >
  • > Should discounts be **percentages** or **absolutes**?
  • >
  • > Consider a \$150 blender. Should you offer 20% off? Or an equivalent \$30 off?
  • >
  • > Answer:
  • >
  • > - **Over \$100?** Give absolutes (e.g., \$30)
  • > - **Under \$100?** Give percents (e.g., 20%)
  • >
  • > In both cases, you show the higher numeral. For a \$50 blender, 20% off is the same as \$10 off — yet 20% is more persuasive because it’s a higher numeral. For a \$150 blender, the absolute discount (\$30 off) is a higher numeral (González, Esteva, Roggeveen, & Grewal, 2016).
  • >
  • > #### References
  • >
  • > González, E. M., Esteva, E., Roggeveen, A. L., & Grewal, D. (2016). Amount off versus percentage off—when does it matter?. Journal of Business Research, 69(3), 1022-1027.
  • Let d = discount, p = price. Then $d, p > 0$ because [there is no free lunch](https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as_a_free_lunch) and [the quotation](https://www.nickkolenda.com/psychological-pricing-strategies/) is expatiating on discounts. Then
  • \$ off vs. % off $\iff p - d \quad \text{ vs } \quad p - (d/100)p \iff -d \quad \text{ vs } \quad -dp/100 \iff 1 \quad \text{ vs } \quad p/100 \iff p \quad \text{ vs } \quad 100. $
#1: Initial revision by user avatar Chgg Clou‭ · 2023-03-22T00:13:24Z (about 1 year ago)
How can school children intuit why over 100, D is larger? But under 100, D% is larger?
#### I  can prove [the Rule of 100](https://www.nickkolenda.com/psychological-pricing-strategies/) algebraically, below. But my school kids are hankering after intuition, and a plainer explanation. 

>![](https://www.nickkolenda.com/wp-content/uploads/2016/09/Follow-the-Rule-of-100-1.png)
>
> ## Follow the Rule of 100
> 
> Should discounts be **percentages** or **absolutes**?
> 
> Consider a \$150 blender. Should you offer 20% off? Or an equivalent \$30 off?
> 
> Answer:
> 
> -   **Over \$100?** Give absolutes (e.g., \$30)
> -   **Under \$100?** Give percents (e.g., 20%)
> 
> In both cases, you show the higher numeral. For a \$50 blender, 20% off is the same as \$10 off — yet 20% is more persuasive because it’s a higher numeral. For a \$150 blender, the absolute discount (\$30 off) is a higher numeral (González, Esteva, Roggeveen, & Grewal, 2016).
> 
> #### References
> 
> González, E. M., Esteva, E., Roggeveen, A. L., & Grewal, D. (2016). Amount off versus percentage off—when does it matter?. Journal of Business Research, 69(3), 1022-1027.

Let d = discount, p = price. Then $d, p > 0$ because [there is no free lunch](https://en.wikipedia.org/wiki/There_ain%27t_no_such_thing_as_a_free_lunch) and [the quotation](https://www.nickkolenda.com/psychological-pricing-strategies/) is expatiating on discounts. Then 

\$ off vs. % off $\iff p - d \quad \text{  vs } \quad p - (d/100)p \iff -d \quad \text{  vs } \quad  -dp/100 \iff 1 \quad \text{  vs } \quad p/100 \iff  p \quad  \text{  vs } \quad 100. $