Pricing Strategies

What is price skimming?

Setting a high initial price and then decreasing it over time

What is price penetration?

Setting a low initial price and increasing it over time

What is predatory pricing?

Setting a low price to eliminate competition

Why is predatory pricing illegal?

Violates antitrust laws at its goal is to create a monopoly

What is competitive pricing?

Charging a similar price to competitors

What is cost-plus pricing?

Creating a price from the cost of manufacturing and then adding a fixed percentage

What is psychological pricing?

Charging a price slightly lower than a whole number