Question

Xerox pioneered the first portable fax machine. In 1980, the price was $12,700. Xerox was using a(n) _____ strategy to help recover the cost of its research and development.
a. penetration pricing
b. cost-plus pricing
c. skimming pricing
d. above-market pricing
e. target ROI pricing

Answer 1

Answer:

c. skimming pricing

Explanation:

Based on the information provided within the question it can be said that in this scenario Xerox was using a skimming pricing strategy to help recover the cost of its research and development. This is a pricing strategy in which the company places a really high initial price for it's new product, but then goes lowering the price as time passes. This also makes individuals believe that they are getting a bargain when prices begin to drop and decide to buy more.