The classical problem of the monopolist faced with an unknown demand curve is considered in a simple stochastic setting. Sequential pricing strategies designed to maximize discounted profits are shown to converge sufficiently rapidly that they leave the monopolist ignorant about all but the most...

A durable-goods model, which allows consumers' values to vary over time, is analyzed. The optimal mechanism for a monopolist is computed and compared to both the sales and leasing equilibria. It is shown that sales may implement the optimal strategy, and that the dominance of leasing over sales...