There is durable good which means that consumers will only buy once (pharma doesn't seem to fit here).
And there is the monopolist. So there shouldn't be any outside options, as the last paragraph claims in the OP.
And the marginal costs seem to be constant. Which is only the case for things like data or software. For most goods, however, one needs to invest in production facilities to increase output for a bigger number of goods. In this case the marginal costs will increase as well and so it would make sense to first sell a lower number of goods for a higher price.
Somehow, it doesn't quite add up for me, but I can't quite put my finger on what it is. It reminds me of the unexpected hanging paradox.
There is durable good which means that consumers will only buy once (pharma doesn't seem to fit here).
And there is the monopolist. So there shouldn't be any outside options, as the last paragraph claims in the OP.
And the marginal costs seem to be constant. Which is only the case for things like data or software. For most goods, however, one needs to invest in production facilities to increase output for a bigger number of goods. In this case the marginal costs will increase as well and so it would make sense to first sell a lower number of goods for a higher price.
Somehow, it doesn't quite add up for me, but I can't quite put my finger on what it is. It reminds me of the unexpected hanging paradox.