(D) The product is perceived by the target market as having unique advantages.
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What is a price skimming strategy?</h3>
- When offering a product or service for the first time, a company can use price skimming as a pricing strategy.
- A company can profit from a higher price in the market and recoup its sunk costs more quickly by using this price skimming strategy and taking the excess profit before new competition emerges and drives down the market price.
- Setting high initial pricing and gradually lowering them has been a fairly standard technique for managers in developing markets.
- The process of price skimming is sometimes referred to as riding the demand curve.
Therefore, apple's price skimming strategy is most often used for a new product when (D) The product is perceived by the target market as having unique advantages.
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Answer:
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Answer with its Explanation:
The forces that had lessened the importance of the cost and management accounting systems in today's dynamic world are as under:
- The ancient bookkeeping and the costing techniques were very time consuming and the accounting systems were also not integrated with the financial accounting systems. Today we have very robust and integrated systems which helps the management of the business operations nation wide with greater security and better performance than the previous old versions.
- The complexity of the organization operations have resulted in origination of additional management accounting techniques that were adapted in the form of automated software, that are used to produce management reports on daily, weekly, monthly and yearly basis. The examples include the Throughput costing, Activity based costing, Bench-marking techniques, etc.
- The activities automation has led to attaining of maximum efficiency possible in some areas which wasn't possible in the past. The robots management systems, activity automation, etc has increased the fixed cost share in the total cost and the variable cost has become a very minute share of the total cost of the activity. This variable cost which is often referred to as controllable cost, is very less in percentage share of total cost today than 10 years back. In the future, we will see it as a very very very small share of total cost. This makes the today's management costing techniques obsolete and requires new solutions, new techniques, new softwares, etc. to manage the companies operations.
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