Asked by Claudia Reyes on Apr 29, 2024
Verified
The number of seats available in an arena is fixed at 20,000. The equilibrium price for a ticket to a basketball game at the arena is $75. The equilibrium price for a ticket to the circus at the arena is $25. Which of the following is true?
A) Basketball games must be more expensive to produce than a circus performance.
B) The demand for each basketball game must be more than the demand for each circus performance.
C) The supply of circus performances must be less elastic than the supply of basketball games.
D) The demand for each circus performance must be greater than the demand for each basketball game.
Equilibrium Price
The price at which the quantity of goods supplied is equal to the quantity of goods demanded.
Elastic
A characteristic of goods or services with demand that is significantly responsive to changes in price.
- Understand the importance of market rivalry and its impact on factor markets and pricing.
- Master the basics of supply and demand in shaping wages and prices in arenas of competition.
Verified Answer
ZK
Zachary KosloskeApr 29, 2024
Final Answer :
B
Explanation :
The higher equilibrium price for basketball games ($75) compared to circus performances ($25) indicates a higher demand for basketball games, assuming the number of seats (supply) is fixed.
Learning Objectives
- Understand the importance of market rivalry and its impact on factor markets and pricing.
- Master the basics of supply and demand in shaping wages and prices in arenas of competition.
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