The expected price for sunscreen is in the $3 to $6 price range. The introductory price for Shade UVA Guard by Schering-Plough was $5.99 to recover its research and development costs. Schering-Plough was using a _____ strategy.
A) cost-plus
B) marketing-skimming
C) market-absorption
D) marginal-cost
E) market-penetration

Question

Quizplus · Accepted Answer

The introductory price of Shade UVA Guard by Schering-Plough was set at the high end of the expected price range to recover its research and development costs, indicating a market-skimming strategy. This approach involves setting high initial prices to "skim" revenue layers from the market.

The Expected Price for Sunscreen Is in the $3 to $6