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 price policy.

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A skimming price policy tries to sell the top (skim the cream)of a market-the top of the demand curve-at a high price before aiming at more price-sensitive customers.In contrast,a penetration pricing policy tries to sell the whole market at one low price.

In the Market Introduction Stage of the Product Life Cycle,if