minimum advertised pricing restrictions imposed by vendors will limit what they can advertise
it also gets people going into their stores which drives sales
and they're cheaper because they want your money and business, not all items are cheaper, but they do have established loss leaders and the like to get you in the door buying stuff (just like why milk is cheaper at Wal-mart than 7-11, but soda and beer is usually cheaper at 7-11)
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