Question

Juliet repairs, buys, and sells old video games to a growing customer base of collectors and fans. She finds that as the products get scarcer, she can charge higher prices for her services and products. This is an example of ________.

Correct Answer
A) harvest pricing

B) plus-one pricing

C) reduce-focus pricing

D) low-cost-leader pricing

E) skim pricing

Answer 1

The scenario described with Juliet charging higher prices for rarer video games is an example of skim pricing.

Step-by-step explanation:

Juliet repairs, buys, and sells old video games to a growing customer base of collectors and fans, finding that as the products get scarcer, she can charge higher prices for her services and products.

This scenario is an example of skim pricing, where a business sets high prices for its products because they are rare or unique. Skim pricing usually occurs when there is a low elasticity of demand, meaning customers are willing to pay higher prices due to the scarcity of the product.