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Odd Pricing is Normal for Gasoline

If you walked into a supermarket and found milk priced by the gallon at $3.46 plus 9/10ths-cent, you'd be astonished. But at the gasoline station next door, you think nothing of seeing fuel priced with 9/10ths of a penny at the end.

Gasoline and diesel are the only widely used commodities priced in such an odd way - with 9-10ths of a penny tacked onto the end of the per-gallon price. It's been that way for decades.

It's become a common marketing ploy. Retailers know that pricing something at $99.95 makes it sound less than a hundred dollars. Gasoline sellers know it, too. A sign advertising gas at $2.99 and 9-10ths cents a gallon sounds like less than $3.

But that little bit of fiction - there's no coin of the realm worth 9-10ths of a cent - means extra big bucks to gasoline retailers. US demand runs about 380-million gallons of gas a day. Rounding up the 9-10ths of a penny on each gallon means 380-thousand dollars a day - about $139-million a year.

Only once - back in 1985 - did state lawmakers in Iowa try to stop the practice by outlawing the 9-10ths price tails. It didn't work. The law was repealed just four years later.

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