How Is a Skimming Policy Different from a Penetration Policy

question 54

Multiple Choice

How is a skimming policy different from a penetration policy?

• A)A skimming policy is used when demand for a product is price inelastic,while a penetration policy is used when demand for a product is price elastic.
• B)A skimming policy is used when a seller wants to charge a relatively low price on a new product,while a penetration policy is used when a seller wants to charge a relatively high price on a new product.
• C)A skimming policy is used to obtain large economies of scale and for the rapid creation of a mass market,while a penetration policy is used to capitalize on a temporary monopoly.
• D)A skimming policy is used to discourage competition,while a penetration policy is used to obtain maximum revenue from the market before substitute products are created.