Economics · Pricing Strategies

A sales director believes that a high price should be charged at launch so that those customers prepared to pay a higher price can be 'skimmed off' first. In which of the following situations would market skimming be an appropriate strategy for the initial launch of a product? 1. The company has an innovative product 2. Competitors have just launched a similar product 3. Demand for the product is inelastic 4. Many substitute products exist