In a "buy 1 get 1 free" sale, why is the "1 free"  free to the buyer but not to society?

Expert Answers

An illustration of the letter 'A' in a speech bubbles

When a buyer buys one thing and gets another free, the second item cannot truly be free.  The reason for this is that someone has to absorb the cost of the "free" item.

It may be that other buyers will make up the price.  They will buy the item later (when it is no longer on sale) and the price they pay will help to make up for the money lost when the items were offered for "free."  It may be that the firm has to "eat" the cost of the "free" items.  If this happens, the firm's shareholders lose out on some amount of profit that they would otherwise have made.

The "free" item still cost something to make and its costs must be absorbed by someone.  You can argue that this means that its cost is borne by society.

Approved by eNotes Editorial Team

We’ll help your grades soar

Start your 48-hour free trial and unlock all the summaries, Q&A, and analyses you need to get better grades now.

  • 30,000+ book summaries
  • 20% study tools discount
  • Ad-free content
  • PDF downloads
  • 300,000+ answers
  • 5-star customer support
Start your 48-Hour Free Trial