Question:
Which pricing strategy sets a high initial price for a new product?
Which pricing strategy sets a high initial price for a new product?
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Skim = High initial price. Penetrate = Low initial price.
Updated On: Jul 3, 2025
- Penetration pricing
- Skimming pricing
- Cost-plus pricing
- Psychological pricing
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The Correct Option is B
Solution and Explanation
Price skimming means launching with a high price to capture high-income segments first and recover R \& D costs quickly. As demand falls, prices are lowered to attract more price-sensitive customers. It’s opposite to penetration pricing, which starts low to capture market share.
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