Psychological pricing is a marketing strategy that aims to influence consumer perception and behavior by setting prices in a way that appears more attractive. For example, pricing an item at $9.99 instead of $10.00 can make it seem significantly cheaper, even though the difference is just one cent. This tactic leverages the way people process numbers, often leading them to focus on the first digit rather than the total amount. Another common technique in psychological pricing is the use of charm pricing, where prices end in the number 9. Retailers often employ this strategy to create a perception of a bargain, encouraging consumers to make a purchase. By understanding how consumers think about prices, businesses can effectively increase sales and enhance customer satisfaction.