Firms intending to maximize market share typically use market skimming pricing strategy.

Question

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Market skimming pricing strategy is typically used by firms intending to maximize profit rather than market share. This strategy involves setting a high price for a new product or service when it is launched and gradually lowering the price over time. This is done to take advantage of early adopters who are willing to pay a premium for the product or service, and then capture more price-sensitive consumers as the price decreases.

Firms Intending to Maximize Market Share Typically Use Market Skimming