Assignments Economics

The Mystery of the Banana Stand

From this Freakonomics blog post @ NYT:

A reader named William Kearney describes the following mystery, which puzzles him every day:

“Outside my building there is a woman with a fruit stand. Everything is normal about this fruit stand except for the fact that the BSL [Banana Stand Lady] will sell you two bananas for $1 and will sell you three bananas for $1! They are the same exact bananas (see attached picture) and the signs and stacks of bananas are literally one foot away from each other. I have done multiple double blind studies to test the quality of both piles of bananas and they really are the exact same. However, BSL gets upset if you try to get the three bananas from the two-banana pile.”

Mysterious indeed. What could possibly be going through the BSL’s head? Is she perhaps a grad student working on a behavioral thesis?

Two for $1.00

Three for $1.00

Leave your comments below for a chance at extra credit (only applicable to my econ students!)

18 replies on “The Mystery of the Banana Stand”

Maybe the lady wants to see how many people will notice that you can get three for $1, not just two. Perhaps she is seeing how many people will notice the two different piles and the two different prices, and how many people don’t even bother checking on that kind of a thing.

I think she is a grad student as suggested. She probably wants to see how people react to the cost of the bananas compared to how many they get although the bananas are exactly the same but there is 2 for $1 or 3 for $1. People will for sure get 3 for $1 before they get the 2 for $1, and once they run out people will still ask for 3 for $1 because as I have seen working with the general public people are looking for offers and expect them although the sale is no longer available. The BSL will definitely see what she needs for her behavioral thesis through this experiment.

i think the lady wants to see how many people actually pay attention to the signs posted at the stand. i think she gets upset if you take the bananas from the 2 banana pile because she is the seller and makes the rules of what you can and can’t do.

I think the lady just wants to see if anyone is paying attention. It always seems like people are in a rush, and don’t bother stopping, and reading what’s in front of them. They could only see the two for $1, and not even look back and see the three for $1. I think she might be trying to make a point, and tell people to not rush, and take the time to do the simple things, like buying a banana.

I think that either the lady made a mistake or something is wrong with the bananas that are 3 for a dollar. She might have got them cheaper or they are from a different place. She also could be working on an experiment but it doesnt seem like it.

I think she is trying to see how people will react to a quantity difference for the same price of the same exact product. I know that if I saw a stand like this I would go for the 3 for $1 because it is the better deal. I think she may be trying to see what people look for when trying to get a deal on things whether it be bananas or any other item we can buy from a stand or store. She may also be trying to observe how well people pay attention and what kind of people pay attention to deals or multiple signs.

I belive that the BSL is trying to draw attention to her fruit stand. As soon as a customer starts thinking about this mystery she has done her job by attractting people’s interest. After that the BSL doesn’t care if you buy two or three bananas as long as she makes a dollar from each customer.

I think it’s possible that the BSL is attempting to see how people make economic decisions and if they always do go for the greater bargain. Even though 3 bananas for $1 is the better deal in the situation, there could be many factors that persuade a person to buy 2 bananas for $1 instead. Also, she could have the bananas at two different costs because if the 3 for $1 bananas are more popular, as they presumably are, then they sell out much faster than the other bananas. There could be a potential shortage in the bananas but the woman would still have the 2 for $1 bananas, which are the same exact quality, and she makes a greater profit off of them.

I think she is either a student performing a behavioral experiment, or she’s just a lady trying to confuse people. Imagine this scenario. On adjacent blocks on either side of the BSL, there are other banana sales people. Both of the other banana sales people sell bananas for a greater price than those of the BSL. People coming from the right will see two bananas for one dollar, and think its a deal. They’ll purchase these bananas without a second thought and will totally ignore the second stack of bananas as they walk past. Those coming from the left will see three bananas for one dollar and do the same as the people who bought two bananas.

Another possibility is that the BSL knows that people are going to want different quantities of bananas. Not everyone is going to want two or three bananas. People will pay for what they want and from her stand, you can buy two or three, but for the same price, but she wants to see if people buy more than what they need just for the sake of getting the bananas at a bargain price.

I like this thinking – we don’t know what the market looks like, but the imagining a limited set of information coming from the left or right of the BSL may very well the key to understand this problem.

There’s real evidence in other markets for this behavior as well – just think about any piece of electronics, or books, or anything you can check the price online for. Or, you may not, and get taken advantage of at the market at the point of exchange! Well done, John!

I think the ‘BSL’ is observing everyone’s behavior. Whether she is a grad student or not, she seems to be interested in if people pay attention to the little things. Everyone is probably always rushing through her market and if they are, and don’t notice her multiple prices, then she makes an extra dollar for the day. I believe the BSL isn’t trying to trick anyone, but simply make them notice that you can get a better deal, just by looking through the market and looking at your other options.

I think the lady is trying to see if someone will even notice that there is 2 different piles. I think she is trying to prove that people don’t shop around to find the better price, they just buy what’s right in front of them. She probably doesn’t like when people take 3 bananas from the 2 banana pile because it proves people are lazy.

I think the BSL is testing the customers. I believe she just wants to see if anyone is stupid enough to only get 2 for a dollar. Also i feel as if shes pricing her goods like this because, in my opinion, it would draw a lot of interest to her stand. People will remember her stand because of the odd pricing she advertises.

I think the BSL lady is trying to see if any of her consumers realize her two different stands. Usually, when people see what they want, they get it right away. But they do not stop to think that there might be another place where they can get the same goods for the same price but a higher quantity. Or in same cases same quantity and quality but a lower price. I think she wants to see how many of her buyers makes observations before they decide to buy the bananas.

I think that it is possible that the BSL paid less money for the 3 bananas for $1 and she gets upset when you try to get the 3 bananas from the 2 bananas pile because she paid more for them. The demand for the 3 for $1 bananas is higher than the 2 for $1 bananas so when she runs out she will still have the 2 for $1 bananas and she will still be making $1 for bananas no matter what. I think the BSL knows that the 3 for $1 bananas will be sold faster so she will make more money when people come to buy bananas and she is out of 3 for $1 bananas so she will sell more 2 for $1 bananas, making more money.

I think the BSL is trying to see who is paying attention to the little things like buying two bananas or three bananas for a dollar, or if people will just buy whatever they see as long as they can get what they need and go. She is probably getting mad when people take three bananas from the two banana pile because it shows how people dont pay attention.

I think the BSL is having her pricing the way it is so that she can get the attention of the customer because she has more then one sale going on. The people will see the 2 for $1 and think its a good deal. Then they will see the 3 for $1 and think it’s an even better deal, and will buy them. By doing this, the BSL is getting business. It may have less profit than the 2 for $1, but business is business.

I think that the signs are fairly small. To me it could be something for people who actually want to buy the banannas or have looked at her merchandise. Someone who is a smart shopper might see the two for one and decide that if there is one sale there could possibly be another sale on another fruit. By grabbing the attention of some customers with the 2 for 1 banannas she has sold some and if the people go to the other side to look for other fruit that could be on sale they would find the 3 for 1 sign. ~I do not know if that made sense!~

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