Dynamic Pricing: The Z-Phone Challenge

Period 1 — Early Adopters

Demand: P = 3000 − 125Q

Set your introductory price to capture high-WTP customers

Period 1 Price:

$500

$500 (MC) $3,000

📈 Your Strategy Results

Period 1 Profit

—

Period 2 Profit

—

Period 3 Profit

—

Total Profit

—

Your Pricing Strategy Summary
Period	Your Price	Quantity (M)	Profit ($M)
Period 1	—	—	—
Period 2	—	—	—
Period 3	—	—	—
Total	—	—	—

Optimal vs. Your Strategy

Period	Your Price	Optimal Price	Your Profit	Optimal Profit
1	—	—	—	—
2	—	—	—	—
3	—	—	—	—
Total			—	—

Optimal rule: Each period, set P* = (demand intercept + MC) / 2. This is the midpoint between the current demand intercept and marginal cost—the profit-maximizing price given that period's residual demand.

Current Graph Data
Measure	Value
Demand Intercept (Period 1)	—
Demand Intercept (Period 2)	Not yet set
Demand Intercept (Period 3)	Not yet set
Marginal Cost	—
Active Period Price	—
Active Period Quantity	—

📱 Dynamic Pricing: The Z-Phone Challenge

📊 Market Scenario