Question

After the financial crisis, consumers' incomes fell. How does it affect concert demand and its ticket price? A) Demand for concert increases. As a result of the shift, ticket price increases. B) Demand for concert decreases. As a result of the shift, ticket price decreases. C) Demand for concert decreases. As a result of the shift, ticket price increases. D) Demand for concert decreases. There is no shift, so ticket price does not change

Answer 1

Answer:

B) Demand for concert decreases. As a result of the shift, ticket price decreases.

Explanation:

A shift in demand that is as a result of other factors except for price results in a shift of demand. A reduction of price as a result of the financial crises will lead to a shift of demand to the left.

Demand for cinema tickets will reduce at all price level.

Referring to the attached diagram the demand shift will result in lower quantity demanded from Q to Q2.

Also there is a reduction of equillibrum price from P to P2.