Are you infuriated every time you open your cell phone bill? Livid when you buy a snack at the movies? These are some of the rawest deals around.
©John R. Coughlin
Text Messages -- 6,500% Markup
Text messages are short, quick and cheap to transmit. So why are they adding so much to your wireless bill?
The messages are such a tiny piece of data that they cost carriers only about one-third of a cent to deliver, according to computer scientist Srinivasan Keshav, who testified before U.S. senators on the issue last summer.
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But on a pay-per-text plan, the 160-character messages typically cost 20 cents outgoing and 10 cents incoming. That's a markup of as much as 6,500%. OMG!
"It's pretty much pure profit," Keshav says. "Carriers would argue they put that money toward investing in new technology."
Even if customers sign up for an unlimited texting plan for, say, $10 a month, carriers are still cashing in considering that their overhead is basically $0. That's a lot to pay for a few LOLs.
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Movie Theater Popcorn -- 900% Markup
A medium bag of popcorn costs just 60 cents to make but retails for $6, a whopping 900% markup. That's enough to make "Avatar" fans turn blue.
Richard McKenzie, an economics professor at University of California-Irvine, says theater owners mark up the snack so much because they don't make a profit elsewhere.
McKenzie, author of the 2008 book "Why Popcorn Costs So Much at the Movies: And Other Pricing Puzzles," says that out of your $10 movie ticket, only a tiny percentage goes to the theater's profits.
"Popcorn is what pays for a lot of stuff in the movie theater," McKenzie says. "A lot of theater owners tell me, 'I consider myself working in concessions, not movies.'"
©Neil Harris / CNNMoney.com
'Free' Credit Reports That'll Cost You
There's nothing free about forking over $179 a year for information at Freecreditreport.com.
Instead you can go to AnnualCreditReport.com, which is run by the Federal Trade Commission, and get a truly free report once a year from each of the credit agencies: Equifax, Experian and TransUnion.
Freecreditreport.com's catchy ditties can get stuck in your head for days -- but subscribing to the service will haunt your credit card bill for a year. When you sign up, you're asked for your credit card number. Then the site automatically enrolls you in its "Triple Advantage credit monitoring," which pledges to continuously track your credit status for $14.99 per month.
A rep for Experian, which owns Freecreditreport.com, says: "We do realize there are a very small percentage of consumers who genuinely do not understand they have signed up for a credit monitoring service. We work to resolve issues with these consumers on a case by case basis."
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Technically, you have nine days to cancel the credit monitoring service before being charged, but many consumers have felt duped. The Better Business Bureau has received more than 11,000 complaints, and the site recently made its policy more prominent on its Web pages.
©John R. Coughlin / CNNMoney.com
Name-Brand Painkillers -- 60% Markup
Is Advil's sleek design worth 160% more than the same medicine in a plain package?
A 50-count bottle of 200 mg Advil tablets costs $8.49, versus just $5.29 for the exact same bottle of generic ibuprofen at a Duane Reade drug store in New York.
Brand names may give us more peace of mind, but the cheaper stuff works just as well, and in exactly the same way. It's required to, by law.
The Food and Drug Administration mandates that generic drugs must be as safe and effective as brand names. Generics have to use the same active ingredients, however they may contain different inactive ingredients like coloring or flavor agents. For its part, the company says it "stand[s] firmly behind the value Advil brings to consumers."
But at a time when many of us are already feeling the pinch financially, a fancy package just doesn't seem worth the headache.
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