How did 9/10th of a penny get started for a gallon of gas?

Question

How did 9/10th of a penny get started for a gallon of gas?

Answer 1

It is historical.  Many, many years ago when gasoline sold for about 20 cents per gallon stations used to compete by posting prices such as 19 in big letters with 9/10 in little letters.  Essentially, this is the same as 20 cents but the casual driver would only see the 19 on the sign and think he was going to save a penny per gallon.  Everyone started to do this and the pricing practice has stuck over all these years.

Answer 2

Fractional pricing is, was always will be due to taxation.  The federal highway taxes applied to every gallon of gasoline sold is the reason for the 9/10ths.  This is why every state has the same pricing scheme.

If gasoline marketers wanted to make gasoline seem cheaper, why don't they use any other fraction but 9/10ths?  It's because we have nothing to do with it.  We sell gasoline to stations for whole pennnies and they sell it to you for whole pennies.

Answer 3

The prevalence of nine-tenths of a cent gasoline pricing seems to owe

its existence to several factors:

--a penny used to be worth something

--Uncle Sam wanted a piece of the gasoline action

--People want to *think* they're getting a bargain, even if they know better

--Old habits die hard, and after a while, just get built into the system.

In addition to the above, there is nothing I know of in the law

preventing gasoline (or just about anything for sale) from having a

fraction of a cent as part of its price.  Just the opposite, early

federal law actually encouraged such fractional pricing of gasoline.

But in reality if it is showing $2.79.9 per gallon people are more likely to buy it then if it said $2.80 per gallon, its just a way to get you into the gas stations.