The strategy of setting a high price when the market is price-insensitive, is called:
A) Market-penetration pricing
B) Market skimming pricing
C) Target profit pricing
D) Going-rate pricing

Question

Quizplus · Accepted Answer

Market skimming pricing involves setting a high price for a new or innovative product when the market is price-insensitive, such as when there are few competitors or when customers value the unique features of the product. This strategy allows the company to quickly recoup development costs and maximize profits, before competitors enter the market and prices start to decline. Therefore, market skimming pricing is the best choice for this scenario.

The Strategy of Setting a High Price When the Market