Final answer:
Market skimming is a strategy where a company initially sets high prices for a new product or service and gradually lowers the prices over time. Therefore, the given statement is FALSE.
Step-by-step explanation:
The statement given, that market skimming is a strategy that uses low prices as a competitive weapon to gain market position, is False. Market skimming is actually a strategy where a company initially sets high prices for a new product or service and then gradually lowers the prices over time. This strategy is often used for innovative or unique products, as it allows the company to maximize profits from early adopters before attracting a larger customer base.
For example, when Apple releases a new iPhone, they initially set a high price to target early adopters who are willing to pay a premium for the latest technology. As time goes on, they lower the price to attract a wider range of customers.