Question

In: Economics

Please answer the question clearly A Stadium faces a downward sloping demand curve for tickets to...

Please answer the question clearly

A Stadium faces a downward sloping demand curve for tickets to soccer games and the stadium has a fixed number of seats available. Assume the marginal cost of filling a seat is zero. Why might said stadium decide not to sell out every soccer game even though the marginal cost of selling additional seats is virtually zero? Discuss and illustrate graphically

Solutions

Expert Solution


Related Solutions

Scenario Suppose that a movie theater faces a downward sloping demand curve for popcorn and it...
Scenario Suppose that a movie theater faces a downward sloping demand curve for popcorn and it increases the price of a container of popcorn from $4.00 to $4.80, which causes the count of containers sold to fall from 100 to 90. Questions 1. What is the elasticity coefficient? 2. Is the demand relatively elastic or relatively inelastic? 3. Should the theater consider raising the price of popcorn further? 4. When a firm faces a downward sloping demand curve, should it...
A monopolist faces a downward sloping demand curve, P = 911.0 - 16.5*Q. It has a...
A monopolist faces a downward sloping demand curve, P = 911.0 - 16.5*Q. It has a marginal cost curve described by the equation MC = 17 + 13*Q. The competitive market price is estimated to be ____ and the monopoly price will be ____. A) $410.97 ; $590.33 B) $455.5 ; $606.8 C) $590.33 ; $455.5 D) $455.5 ; $606.8 A monopolist faces a downward sloping demand curve, P = 369.0 - 12.5*Q. Total revenue will be maximized at a...
Suppose the firm is a monopolist. It faces a downward-sloping demand curve, P(Q). If it also...
Suppose the firm is a monopolist. It faces a downward-sloping demand curve, P(Q). If it also has non-negative marginal cost, will it choose a quantity on the demand curve where the price elasticity of demand is less than, greater than, or equal to -1? Explain. Two Hints: First, recall that R(Q) = P(Q) times Q, and that the price elasticity of demand is defined as . Second, recall the condition MR = MC. Think about how the firm’s revenue will...
1.    Which statement below is FALSE? A         A monopoly faces a downward-sloping demand curve for the...
1.    Which statement below is FALSE? A         A monopoly faces a downward-sloping demand curve for the good that it sells. B          A single-price monopoly cannot sell further units of the good without cutting the price. C          Total revenue is maximized where marginal revenue is zero. D         In the short run, a single-price monopoly maximizes profit where average cost equals average revenue. E          In the long run, a single-price monopoly seeking to maximize profit would exit the industry if average total...
Explain why demand curve are downward sloping
Explain why demand curve are downward sloping
5) Suppose a firm has market power and faces a downward sloping demand curve for its...
5) Suppose a firm has market power and faces a downward sloping demand curve for its product, and its marginal cost curve is upward sloping. If the firm reduces its price, then: A) consumer and producer surplus must increase. B) consumer surplus increases, producer surplus may increase or decrease. C) consumer surplus increases, producer surplus must decline. D) consumer and producer surplus must decline.
- For a monopolist who faces a downward-sloping demand curve, marginal revenue is less than price whenever
TRUE OR FALSE. PROVIDE EXPLANATION.- For a monopolist who faces a downward-sloping demand curve, marginal revenue is less than price wheneverquantity sold is positive.- Since a monopoly charges a price higher than marginal cost, it will produce an inefficient amount of output- A monopolist will always equate marginal revenue and marginal cost when maximizing profit- If s/he produces anything at all, a profit-maximizing monopolist with some fixed costs and no variable costswill set price and output so as to maximize...
a. No price discrimination: Assuming Monopoly General Hospital (MGH) faces a downward sloping demand curve (i.e....
a. No price discrimination: Assuming Monopoly General Hospital (MGH) faces a downward sloping demand curve (i.e. not perfectly elastic/inelastic), and can only charge one price to all patients, briefly explain intuitively why its marginal revenue is always lower than the price for any given quantity of services demanded. b. Perfect price discrimination: Now suppose instead that the MGH is able to charge each individual patient exactly her willingness-to-pay for its services, and does so (i.e. perfect Price Discrimination). What is...
Please answer all four questions, thanks!! 1. Assuming a downward-sloping (not vertical) demand curve, as one...
Please answer all four questions, thanks!! 1. Assuming a downward-sloping (not vertical) demand curve, as one moves down the demand curve describe the relationship involving price elasticity of demand, total revenue, and marginal revenue. 2. Itemize and briefly describe the determinants of price elasticity of demand. 3. Congratulations! You have just become the sole owner of a NFL (National Football League) franchise. Assuming that your goal is to maximize revenues, do you necessarily want to sell out the stadium on...
If the demand for labor is reflected in a downward sloping linear demand curve, then successive...
If the demand for labor is reflected in a downward sloping linear demand curve, then successive increases in any binding minimum wage (that is, for example, a binding minimum wage increases from $10.10/hr to $12.10/hr and then from $12.10/hr to $14.10/hr), will result in Multiple Choice no job losses since the demand for labor, particularly unskilled labor, is highly price inelastic.    increasing (as a percentage) job losses, and decreasing total income (or reduced rates of income growth) paid to...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT