[quote name='Monsta Mack']My question: What if the game drops to $40 (like Blitz) ? I notice stores like Wal-Mart and Best Buy had 12+ copies, and since they only make 20% or so margin on them, that means they would lose $10 on each copy that just dropped in price?[/quote]
That's usually what happens.
For example, my boss ordered 3 copies of Infinite Undiscovery when it came out. 2 of those 3 copies sold, and then the game receives a price drop from $59.99 to $39.99. We paid $50.50 for each copy of the game the store bought, so when it dropped to $39.99, the store ended up losing $10.