Question

kinsey invented a new clothing product that was unique and the first of its kind in the sports world. she spent five years creating the product and had invested money and time to make its prototype. she believed it would improve the performance of athletes. she was now ready to price her products. her mentor suggested a pricing strategy that would set the price high at the introduction of the product, and then lower as competitors entered the market. this type of pricing strategy is known as

select one:

a. penetration pricing

b. price skimming

c. status quo pricing

d. price fixing

Explanation:

To determine the pricing strategy, we analyze each option:

• Penetration pricing sets a low initial price to gain market share, which is not the case here.
• Price skimming involves setting a high price initially (when the product is unique and has little competition) and then lowering it as competitors enter. This matches the scenario where Kinsey's product is new and unique, and the price will be lowered later.
• Status quo pricing matches competitors' prices, which is not described here.
• Price fixing is an illegal agreement to set prices, not relevant here.

Answer:

b. Price skimming