Class 6: The Pricing Problem: MR = MC

Textbook reading: Kreps, Chapter 6, “Marginal Cost Equals Marginal Revenue.” Read Sections 6.1, 6.2, the Freedonian Steel and stadium examples in 6.3, and Sections 6.4 and 6.5. Kreps uses calculus throughout; wherever he takes a derivative, we will use a table of small steps instead, and every calculation in this class can be done by subtraction. Skip the “Multivariable Optimization” subsection and the subsection “What’s Wrong with This Picture.”

📚 These class notes will be published here after class.