The definition of a just-below (JB) price seems to be quite clear:

A just-below price has a value that is just below the value of a round price

We have already seen that a just-below price has a very similar content (value) to its corresponding round price, but its visual form (its digits) seems to be different — even completely different  — from the digits of the round price. However, it is still not clear what does it mean to be just below a round value. In other words, what does it mean to have very similar values? We can be sure that $1.99 and $2.00 are very similar in value. Are also $39 and $40? (In form, we know $39 and $40 are not similar in form, since their leftmost digits are different).

In a first approach to characterize just-below prices, we could say that they overuse the digit ‘9’. In fact, 9’s appear very often in just-below prices. $199.99 is full of them. It is, for sure, a just-below price. $2.99 is surely too JB. We can come to a very interesting and true conclusion: 99-endings are a distinctive mark of many just-below prices. We could turn this fact into a mnemonic, a red alert to our minds for prevention against psychological pricing: “Whenever a price ends with 99, round it up!”

Nonetheless, it tell us very little whether we should round $39 or not. Is not true that an ending with a single nine always results in a price that is just below a round value. Take $39 as an example. Its corresponding round value would be $40. But the one-dollar-difference between $40 and $39 represents 2.5% of the round value ($40). 2.5% could be considered too big to characterize thirty-nine dollar as JB.

On the other hand, a price with no nine sometimes may be considered JB. This time, take $888 as an example. This price is only $12 below the round value of $900. In percentage, the difference between the round value and the JB represents only 1.33% of the round value. It is easier to consider $888 just-below than $39.

In order to assess a price as JB or not, we subtract the price from its corresponding round value and transform this subtraction into a percentage of the round value. If the percentage is below a certain limit, then the price is a just-below one. Otherwise, it is not.

But how much is this limit?