Retail economics

I need to understand few things in retail marketing, answers anybody ?
  • If a product can be offered in “buy one, get one free” deal, why same product can’t be offered in averaged “half price”?
  • Why governments offer subsidy on buying a new car by scrapping an existing one, even it is in running condition?
  • Why return tickets are almost equal or cheaper than one way? In theory it should be half, right?
  • Why bottle of water costs more then any other bottled drink like coke? I can’t think of any logic behind this.
  • Why nicotine gums have more nicotine (2mg or 4mg each gum) than actual cigarette (8mg for whole box)?

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4 thoughts on “Retail economics

  1. they also baffled me
    on the govt it could be to promote consumption and prevent the plants from idling and for moving inventory
    on return ticket there can be the justification
    1. they earn for an event occurring in future
    2. they save on the return transaction cost (though it is a fixed cost)
    on nicotine gum it could be cause it takes more time to get to the bloodstream
    on water it could be that it costs more to ship the water from some stream up the swiss alps or some exotic location aka evian.

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