theater company presents a play in a theater with a capacity of 2,000 spectators. With the ticket price at $20, the average attendance at recent games has been 1,000. Market research indicates that for every dollar the ticket price drops, attendance will increase by 100. Identify the feature that maximizes ticket revenue.

theater company presents a play in a theater with a capacity of 2,000 spectators. With the ticket price at $20, the average attendance at recent games has been 1,000. Market research indicates that for every dollar the ticket price drops, attendance will increase by 100. Identify the feature that maximizes ticket revenue.

Microeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506893

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter7: Consumer Choice And Elasticity

Section: Chapter Questions

Problem 13CQ: Suppose Erin, the owner-manager of a local hotel projects the following demand for her rooms: a....

See similar textbooks

Similar questions

A baseball team plays in a stadium that holds 54000 spectators. With the ticket price at $8 the average attendance has been 24000. When the price dropped to $6, the average attendance rose to 27000. Assume that attendance is linearly related to ticket price. What ticket price would maximize revenue? $
A baseball team plays in a stadium that holds 50000 spectators. With the ticket price at $10 the average attendence has been 22000. When the price dropped to $8, the average attendence rose to 25000. Assume that attendence is linearly related to ticket price. What ticket price would maximize revenue? $
A baseball team plays in a stadium that holds 70000 spectators. With the ticket price at $12 the average attendence has been 30000. When the price dropped to $11, the average attendence rose to 35000. Assume that attendence is linearly related to ticket price.What ticket price would maximize revenue? $
A baseball team plays in a stadium that holds 72000 spectators. With the ticket price at $8 the average attendance has been 29000. When the price dropped to $6, the average attendance rose to 36000. Assume that attendance is linearly related to ticket price. What ticket price would maximize revenue? $ Submit Question
Assume that the Morgantown Pizza is the exclusive destination for pizzas for WVU students. In other words, assume that the Morgantown Pizza is the only pizza place for WVU students. At current market condition, the price elasticity of demand is estimated to be 0.9. To increase revenue, the Morgantown Pizza should increase the price and attract less customers. cut the price and attract more customers.
In which of the following situations will total revenue increase? Price elasticity of demand is 1.2 and the price of the good increases. Price elasticity of demand is 0.5 and the price of the good decreases. Price elasticity of demand is 3.0 and the price of the good decreases. Price elasticity of demand is 1.0 and the price of the good increases.
Question 20.span>20. Refer to the information and assume the stadium capacity is 5,000. The supply of seats for the game Price per Ticket Quantity Demanded $13 1,000 11 2,000 9 3,000 7 4,000 5 5,000 3 6,000 varies inversely with ticket prices. varies directly with ticket prices. is perfectly inelastic. is perfectly elastic.
Which of the following is most likely to have a low price elasticity of demand? A good that is very expensive. A good with no close substitutes. A good that most people consider a luxury. All are equally likely to have a low price elasticity of demand.
Demand will be more inelastic when the time the consumer has to adjust to price changes is short. the price of the good is high. the number of good substitutes is large. the good is narrowly defined
The aggregate demand for a cup of coffee is given by g= 50,000 - 10,000 p, where p is the price of a cup of coffee. If the price is $2, then the price elasticity of demand for tickets is 0.666 0.333 1 1.5
The economic advisor of a large tire store proposes the demand function D(p) = = 1800 P-20' where D(p) is the number of tires of one brand and size that can be sold in one day at price p. Answe
3.2. The stadium of the MANU has 30 seats. The demand curve for tickets has a price intercept of $36 and a quantity intercept of 72.3.2.1. Draw the supply and demand curves to scale (in Excel and copy it to your word answer-This demand curve has the form P = 36−0.5×Q.) 3.2.2. Determine the equilibrium admission price, and the amount of revenue generated from ticket sales for eachgame. 3.2.3. A local alumnus and benefactor offer to install 6 more seats at no cost to the University. Compute the price that would be charged with this new supply and compute the revenue that would accrue at this new equilibrium price. Should the MANU accept the offer to install the seats?