A price skimming strategy is most often used for a new product when:
A)competition in the market is abundant.
B)customers are unwilling to spend a large amount of money on the product.
C)its supply is greater than its demand.
D)the product is perceived by the target market as having unique advantages.

Question

A price skimming strategy is most often used for a new product when:
A)​competition in the market is abundant.
B)customers are unwilling to spend a large amount of money on the product.
C)its supply is greater than its demand.
D)​the product is perceived by the target market as having unique advantages.

Quizplus · Accepted Answer

Price skimming is a strategy of setting a high price for a new product, with the aim of generating maximum revenue from the early adopters, who are willing to pay a premium for the product's unique features or benefits. Therefore, it is most often used when the product is perceived by the target market as having unique advantages. In other scenarios, such as abundant competition or low customer willingness to pay, a different pricing strategy might be more appropriate.

A Price Skimming Strategy Is Most Often Used for a New