Question

Which statement below best describes what will most likely happen, from an economic standpoint, when a music group with growing popularity goes on tour and sells out a certain venue in hours with tickets for $25 apiece?
a. Nothing changes, since the market is already clearing.
b. The price of tickets for future concert dates will rise until it hits equilibrium.
c. The group will cancel the concert and give everyone a refund.
d. The group will add more performance dates with tickets at a lower cost.

Answer 1

Answer:

A

Explanation:

Market clears when quantity supplied equals quantity demanded. here the market is in equilibrium

Equilibrium price is the price at which quantity demand equal quantity supplied. Above equilibrium price there is a surplus - quantity supplied exceeds quantity demanded.

Below equilibrium price there is a shortage - quantity demanded exceeds quantity supplied