(a).

Horizon Tech would be able to adopt its market skimming strategy successfully in the following conditions:

(i) when the niche market for its products comprises of customers who can afford and are willing to buy the product at the high prices.

(ii) when the firm is in a position to obtain the advantage of initial high price of its products for the duration that it intends to pursue its market skimming pricing strategy.

(iii) when the high price would create and convey an image of superior quality products among the buyers.

(iv) when the unit cost of manufacturing a small quantity of output is not so high so as to offset the advantage of selling the product at the high price.

(b). It would be advantageous for Unity Furniture Company to pursue a market penetration strategy in the following situations:
(i) when the demand for household furniture is price elastic.
(ii) when the firm is in a position to achieve significant economies of scale by producing and selling a large volume of output.
(iii) when the quality of the furniture sold by Unity Furniture Company and its promotional strategies are designed to capture a large share of the expanding market.
(iv) when there is intense competition in the market, and Unity Furniture Company wants to retain/expand its share of the market to derive benefits in future.