In the market introduction stage of the product life cycle, if a firm has economies of scale and expects competitors to enter the market soon, it would be wise to adopt a skimming pricing policy.

Question

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In the scenario described, it would be more strategic for the firm to adopt a penetration pricing policy to quickly gain market share and deter competitors from entering the market, rather than a skimming pricing policy which involves setting high prices initially.

In the Market Introduction Stage of the Product Life Cycle