The face value of a ticket to the Super Bowl was approximately $1,200 in 2011 . The game is very popular and there are a number of fans who are not able to get tickets to this game. At the same time, many fans claim that prices are too high and that the
NFL should lower the face value of the ticket prices. Would a decrease in ticket prices move the market towards equilibrium? Would it eliminate the shortage of tickets? Why or why not?
Lowering the ticket prices would not move the market towards equilibrium. The fact that there is a greater quantity demanded than quantity supplied indicates that the face value is currently below the equilibrium price. Lowering the face value would cause a more severe shortage as more consumers would want to purchase tickets at the lower price, increasing the quantity demanded. At the same time the quantity supplied would likely remain the same given the size of the stadium.
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Using the standard 45° line diagram, how does an increase in investment spending effect the expenditure schedule?
A. It shifts the expenditure schedule downward. B. It shifts the expenditure schedule upward. C. It increases the slope of the expenditure schedule. D. It decreases the slope of the expenditure schedule.
In the long run, each firm in a competitive industry earns
a. zero accounting profits. b. zero economic profits. c. positive economic profits. d. positive, negative, or zero economic profits.
The distinction between supply and the quantity supplied is best made by saying that:
A. the quantity supplied is represented graphically by a curve and supply as a point on that curve. B. the quantity supplied is in an inverse relation with prices, whereas supply is in a direct relation. C. the quantity supplied is in a direct relation with prices, whereas supply is in an inverse relation. D. supply is represented graphically by a curve and quantity supplied as a point on that curve.
What is the dilemma of the advertisers' dilemma?
What will be an ideal response?