Chapter 121 Question 109

Why do some brands of ice cream only sell small portions, while others only sell large portions? (Patty Kunz, Monica Devine) Supermarkets around the world generally sell a variety of brands and flavors of ice cream.Consumers who love a particular brand often can't find the right portion size they want.For example, Ithaca's largest supermarket sells Unilever's Breyer's ice cream in every flavor, but only in half-gallon sizes.The store also sells Ben & Jerry's ice cream in a variety of flavors, but only in small pint sizes.Why is there such a difference? Ben and Jerry's is commonly perceived as a high-end ice cream, partly because the company uses expensive ingredients and treatments to make its ice cream, and partly because it has a history of sourcing environmentally friendly raw materials and actively developing its employees. relational items.Since it costs more, it has to charge a higher price.A pint of Ben and Jerry's Super New York Ice Cream Balls 3.Sixty-nine dollars, this price is converted into a half gallon, which is one or four.Seventy-six dollars.Conversely, a half-gallon of Brier brand mint chocolate ice cream costs only four.Ninety-nine dollars.

Evidence shows that consumers are not only sensitive to price per ounce, but also value the total price of a product.When premium ice cream first entered the market, consumers were used to buying the relatively low-priced half-gallon packs: They found that Ben and Jerry's tasted better than other ice creams, but also cost the most.Even so, it would probably surprise many people to see a fifteen-dollar price tag on a can of ice cream.Only selling small pint portions, Ben & Jerry carefully sidesteps the question of how expensive it is.Besides, if people really want to buy more ice cream, they just need to buy a few more.

For the sake of simplicity, traditional economic models generally assume that people are selfish in a narrow sense.Obviously, self-interest is an important human motivation, but people are also motivated by other motivations.For example, the narrowly defined pursuit of self-interest cannot explain why people donate anonymously to charity or vote anonymously in presidential elections.Behavioral economics tells us that if we want to understand the choices people actually make in economic activities, we must analyze human motivation in more detail. Ethical issues often leave a clear mark on market transactions, although not always in the expected way, of course.