Final answer:
A firm uses skimming pricing when it sets a high initial price for a new product and plans to lower it later. It is a strategy to maximize early profits, different from predatory or penetration pricing.
Step-by-step explanation:
A firm is using skimming pricing when it charges a high, premium price for a new product with the intention of reducing the price in the future. This pricing strategy is often used to maximize profits in the early stages of a product's life cycle, recovering initial costs quickly before competition increases or market interest wanes.
This is not to be confused with predatory pricing, which involves setting prices low to drive competitors out of the market, nor with penetration pricing, which sets a low initial price to quickly build a customer base.
Trade secrets and trademarks are unrelated concepts referring to the protection of proprietary processes and branding respectively.