We don't perceive prices logarithmically when selling things.

Comments

• frezik@lemmy.blahaj.zone ⁨1⁩ ⁨day⁩ ago

  This could use some explanation and layout of the implications.

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• miss_demeanour@lemmy.dbzer0.com ⁨1⁩ ⁨day⁩ ago

  Hence why I keep one of these in my sellingg satchel:

  slide rule

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  • 667@lemmy.radio ⁨1⁩ ⁨day⁩ ago

    All my homies use a circular one:

    Image

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• bran_buckler@lemmy.world ⁨1⁩ ⁨day⁩ ago

  How would that work? Like these ten apples are equal to 2 bags of oranges?

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  • iii@mander.xyz ⁨1⁩ ⁨day⁩ ago

    Guessing they mean;

    A 5 EUR coffee is 1 EUR more than a 4 EUR coffee.

    A 50000 EUR car is 5/4th or 125% tumes a 40000 EUR car.

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    • cravl@slrpnk.net ⁨1⁩ ⁨day⁩ ago

      125% times

      …is the most cursed thing I’ve seen all day. Especially so when you realize that when you convert it to a decimal of 1.25, the sentence is completely correct. Bravo. 😅👏

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• cravl@slrpnk.net ⁨1⁩ ⁨day⁩ ago

  If I understand you correctly, I think “people don’t easily comprehend the significance of increasing orders of magnitude” is a better way to frame it. To use iii’s examples, people perceive a coffee that costs 5 as being 1 unit more than a coffee costing 4. But when comparing two cars costing 40000 and 50000, the human brain tends to just latch on to the most significant digit, and starts to see it the same way: just one unit more.

  Tangentially, given our brains’ difficulty processing large numbers, I wonder if this effect leads to money management skills being worse on average in economies with smaller base currency units, such as the Japanese Yen, Indian Rupee, South Korean Won, or for an extreme case study, the Iranian Rial, which currently exchanges at 49,313 IRR ≈ 1 EUR. When your haircut costs 1200000, a new phone costs 18700000, and a new car costs 1331400000, it’s hard to judge the weight of your decisions. When the slightly nicer car costs 1645200000, it’s near impossible to notice that you just spent your coffee money for an entire year (~5 days a week for 50 weeks) on a moonroof and Apple CarPlay. Not sure if that example is applicable to the average Iranian, but eh.

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• bryndos@fedia.io ⁨1⁩ ⁨day⁩ ago

  I'd think the opportunity cost is easier to realise with the absolute difference in currency units.
  The price of any alternatives you might consider is usually specified as a ratio of currency units.

  The only relative that I'd think might be helpful for expensive purchases would be to convert a price or price difference into number of days/ week / months of your expected disposable income or something like that.

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