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Companies facing the challenge of setting prices for the first time can choose between two broad strategies: market-penetration pricing and ________. market-level pricing market-competitive pricing market-skimming pricing market-price lining market-price filling

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Answer:

The correct answer is letter "C": market-skimming pricing.

Explanation:

A product price can be introduced using a market penetration strategy and market-skimming pricing. Market penetration pricing unveils a new product or service to draw buyers away from rivals at an initially low price. Market-skimming pricing is a technique that unveils a product that consumers can pay for it at the highest price. It helps to produce significant profits that will help a business recover production costs quickly.

chilljain33

The correct statement will be companies facing the challenge of setting prices for the first time can choose between market penetration pricing and market skimming pricing. So, the correct option is C.

Both the methods as mentioned are completely differentiated in their pricing strategies but are efficient enough for the firm's sustainability determined in the short as well as the long run.

  • The market penetration pricing refers to setting the prices in such a way that in the competitive market the firm's prices will be lower compared to its competitors so that it gains a market share.

  • A market skimming pricing is a method used to eradicate the production costs and the fixed costs of the company in a very short period due to premium pricing of a product.

  • This method is useful only in case of a less penetrated and less competitive market as the consumers maximum ability to pay such price is tested reaping maximum profits of the firm.

Hence, the correct option is C that the market skimming pricing can be used by the company along with market penetration pricing to enter into a new market.

To know more about market pricing, click the link below.

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