Skimming Pricing Is a Strategy That Introduces a New or Innovative

question 47

Multiple Choice

Skimming pricing is a strategy that introduces a new or innovative product by

• A) following a price elastic strategy.
• B) creating multiple price points.
• C) setting a high initial price.
• D) setting a low initial price.
• E) setting the price at the average of competitors' prices.

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Definitions:

Economies of Scale

Economies of Scale refer to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.

Barriers to Entry

Obstacles that make it difficult for new competitors to enter a market.

Government-Set Barriers

Regulations or policies implemented by the government that restrict entry into certain markets or industries.

Demand Curve

An illustrative chart depicting how the cost of an item correlates with consumer demand for that item.