Setting high prices when products are first introduced into the market is known as:
A) peak-load pricing.
B) penetration pricing.
C) price discrimination.
D) price skimming.

Question

Quizplus · Accepted Answer

Price skimming is the practice of setting high prices for new products or services with the intention of maximizing profits in the short-term. This strategy is often used for products with unique features or benefits that appeal to early adopters who are willing to pay a premium price. As competition and demand increase, the price can gradually be lowered to attract a larger customer base.

Setting High Prices When Products Are First Introduced into the Market