Suppose demand for seats at football games is P = 1900 - (1/50) Q and supply is
Question:
Suppose demand for seats at football games is P = 1900 - (1/50) Q and supply is fixed at Q = 90,000 seats.
a. Find the equilibrium price and quantity of seats for a football game (using algebra and a graph).
b. Suppose the government prohibits tickets scalping (selling tickets above their face value), and the face value of tickets is $50 (this policy places a price ceiling at $50). How many consumers will be dissatisfied (how large is excess demand)?
c. Suppose the next game is a major rivalry, and so demand jumps to P = 2100 - (1/50) Q. How many consumers will be dissatisfied for the big game?
d. How do the distortions of this price ceiling differ from the more typical case of upward- sloping supply?
Face value is a financial term used to describe the nominal or dollar value of a security, as stated by its issuer. For stocks, the face value is the original cost of the stock, as listed on the certificate. For bonds, it is the amount paid to the...
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a The equilibrium quantity is Q 90000 seats and the equilibrium price is P 1900 150 90000 1...View the full answer
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