I've asked a lot of people the above question, and I've received a lot of different answers. Some people would pay $6, others wouldn't balk at $8.99 or $9.99 if they really wanted to read it.
Yet many of the Top 100 bestsellers on Amazon are priced at 99 cents to $2.99 for indie authors. So although many people may not admit it, a low price will move copies. Currently, I've priced my book at $3.95, and nobody's balked at the price, and some people have told me it's too low. After all, people shell out $4.20 for a coffee that will last an afternoon; why not more for a book that will last many hours? So I may bump up the price, and debut my next book somewhere along the lines of $4.99 - $5.99, especially since I'm planning for it to be a little longer.
So far, these look like reasonable guidelines:
99 cents to $1.99: novella or short story collection (under 150 pages)
$2.99 and up: novel, or collection of novellas and short stories ranging about 150+ pages
But of course, it depends on genre. In romance, 99 cents seems to be popular. Romance novels are written to be read and enjoyed quickly, and readers buy many of them, so keeping the price low makes sense. For a sci-fi novel that ranges 400+ pages and might take many hours to read, $5.99 might seem like a fairer price.
I'd like to conduct experiments and surveys as to what the best price is, but even retailers vary on prices. A paperback might be anywhere from $10 to $17. Hardcover can be a wild card. $18.99? $24.99?
I'm really interested in what the "upper limit" of prices are, though--at what point will a reader look at an ebook's price and say, "No way"? For me, it's about $5. Any higher than that, and I'll usually grab the paperback.