Troy Bourbon,a local bourbon distillery,initially sold its product at a premium price of $45 because the company believed consumers would view the bourbon as a prestige item.The company decided that when startup costs had been fully recovered and competition became imminent,the company would reduce the price to $30 which was more expected in the market.The distillery is using a

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The distillery is using a skimming price strategy, which involves setting a high initial price to recover startup costs and then lowering it once competition increases.

Troy Bourbon,a Local Bourbon Distillery,initially Sold Its Product at a Premium