Selling/trading iPhone 4 for iPhone 5?

I've heard that Verizon or Best Buy will buy your iPhone 4 then sell you a 5 for a cheaper price. How does this work and how much would the 5 be?

I'd suggest do something else like this: -
I'm assuming your contract is over, so get your phone unlocked from the carrier you purchased it from, they do it for free. Then sell it on ebay or a friend, this way you get better money for your old phone. These exchange programmes often get you far less money then you'd get by selling your old phone after getting it officially unlocked and selling them.

And, if you can i'd suggest get the iPhone 5S not the 5C, i don't think you get the original iPhone 5 these days.