Each round, the monopolist uses the “+” button to sequentially add pallets to the shipment of pharmaceuticals.
Clicking the pill button at the top of the stack of pallets will subtract one pallet from the shipment.
When the monopolist adds or subtracts a pallet from the shipment, price and marginal revenue will adjust on screen.
To see a graphical depiction of the monopolist problem, click the “Show Graph” button to see the demand, marginal revenue, and marginal cost curves.
To finalize the shipment press “Done”
Suppose the monopolist has a cost of $2 per unit. The monopolist sets quantity to be 7 units. Given the market demand curve: P = 20 - 2Q that means the market price will be P=20 - 2(7)=6. So the monopolist profit is: