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Message: <blockquote data-quote="Jdvn1" data-source="post: 3494205" data-attributes="member: 26424">The numbers are based on the economic theory of monopolies. I didn't take the time to figure out what the loss of revenue would be, but it is more than likely is true that a 34% loss of sales combined with the corresponding drop in price would probably kill them.Both firms' models would assume essentially the same populations--all D&D gamers. Demand curves are based on any would-be buyers, if the price were low enough. If it were free, would you subscribe? If so, you're included in the demand curve. This is how the graph works:[sblock]Take a graph. The vertical axis represents price, and the horizontal quantity.On said graph, draw a downward sloping line. That's the demand curve.Now, draw a straight horizontal line (assume it's towards the bottom of the graph). That's the cost curve (this is an abstraction, but not a bad one).For a monopoly: Look at the point where the cost curve intersects the demand curve, and look at the point where the cost curve intersects the vertical axis. In the middle of these points (or, as close to the middle as you can make it), draw a vertical line (divide the line in two equal parts). Look at where the vertical line and the demand curve intersect. Label this "Monopoly." The x-coordinate represents How the production level of a monopoly. The y-coordinate represents the corresponding price.For a duopoly: Instead of dividing the cost line in two, divide it in three--two evenly spaced lines--and focus on the rightmost line. Label the intersection point between the rightmost line and the demand curve, "Two firms."The farther to the right the point is, the more people are buying the product. Also, the lower the price gets. Everything to the right of the point is "deadweight loss"--loss due to the market's inefficiency. In a "perfect competition" the point never falls below the cost curve, because then everyone would be losing money.The population is, "Anyone who would ever buy said product, if it were free" because the demand curve goes past the cost curve, all the way down to price = 0. I can't imagine that if the price were 0, that the populations between DI and Dragon/Dungeon would be immensely different.The obvious problem is that this graph assumes (it's a better assumption in most other industries) that each firm has roughly the same costs to produce. Between DI and Dragon/Dungeon, this definitely isn't true, and it probably wouldn't be a bad assumption to say that DI can provide a lower price than Paizo can handle. Paizo, knowing this before DI came out, is forced to exit the market.However, this also leads me to say that DI should cost less than the magazines. (Whether or not it's true remains to be seen, as the "new" monopoly still has to "feel" out the market before it knows exactly where to maximize profit.[/sblock]My guess is that you'll be a very happy customer, then! <img src="https://cdn.jsdelivr.net/joypixels/assets/8.0/png/unicode/64/1f642.png" class="smilie smilie--emoji" loading="lazy" width="64" height="64" alt=":)" title="Smile    :)"  data-smilie="1"data-shortname=":)" /></blockquote>

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