In marketing as in medicine, perception can be everything. A higher price can create the impression of higher value, just as a placebo pill can reduce pain.
Now researchers have combined the two effects. A $2.50 placebo, they have found, works better one that costs 10 cents.
This is clearly a far stronger version of price sensitivity of satisfaction / liking that was reported sometime ago; in that research wine was the object of our price-sensitive affection. [Just a couple of days ago, I inked to a some commentary on this research].