To Demonstrate: On December 17 t h , 2015 tickets for Adele’s highly anticipated U.S concert tour went on sale at ticket-master on a first come. First served basis. Throughout the day, a record 10 million people tried to purchase the 750,000 tickets available. In an attempt to prevent ticket scalping, Adele and Ticketmaster limited buyers to four tickets per concert and require that premium seat holders present the credit card used to purchase tickets to get into the concert. Despite these attempts to restrict resale, tickets on secondary Sites like Stub-Hub were selling for ten times their face value. Diagrammatically, the supply- demand situation for the tickets of the music concert, the equilibrium price , output and the shortage. (Assume all tickets cost $150) The consumer and producer surplus . Explain how reselling tickets on secondary sites can increase consumer surplus . Concept Introduction: Consumer Surplus: The difference between the price that the consumers are willing to pay for a unit of a product and the price they actually pay.

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Answer 1

Question

Definition Definition Consumer surplus is the consumers' gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price, up to the equilibrium quantity. Producer surplus is the producer's gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price, up to the equilibrium quantity. Consumer surplus is represented by Area A and producer surplus is represented by Area B.

Chapter 4, Problem 11P

To determine

To Demonstrate:

On December 17^t^h, 2015 tickets for Adele’s highly anticipated U.S concert tour went on sale at ticket-master on a first come. First served basis. Throughout the day, a record 10 million people tried to purchase the 750,000 tickets available. In an attempt to prevent ticket scalping, Adele and Ticketmaster limited buyers to four tickets per concert and require that premium seat holders present the credit card used to purchase tickets to get into the concert. Despite these attempts to restrict resale, tickets on secondary Sites like Stub-Hub were selling for ten times their face value.

Diagrammatically, the supply-demand situation for the tickets of the music concert, the equilibrium price, output and the shortage. (Assume all tickets cost $150)

The consumer and producer surplus.

Explain how reselling tickets on secondary sites can increase consumer surplus.

Concept Introduction:

Consumer Surplus:

The difference between the price that the consumers are willing to pay for a unit of a product and the price they actually pay.

Expert Solution & Answer

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11:44 Fri Apr 4 Would+You+Take+the+Bird+in+the+Hand Would You Take the Bird in the Hand, or a 75% Chance at the Two in the Bush? BY VIRGINIA POSTREL WOULD you rather have $1,000 for sure or a 90 percent chance of $5,000? A guaranteed $1,000 or a 75 percent chance of $4,000? In economic theory, questions like these have no right or wrong answers. Even if a gamble is mathematically more valuable a 75 percent chance of $4,000 has an expected value of $3,000, for instance someone may still prefer a sure thing. People have different tastes for risk, just as they have different tastes for ice cream or paint colors. The same is true for waiting: Would you rather have $400 now or $100 every year for 10 years? How about $3,400 this month or $3,800 next month? Different people will answer differently. Economists generally accept those differences without further explanation, while decision researchers tend to focus on average behavior. In decision research, individual differences "are regarded…

Answer 2

Question

Definition Definition Consumer surplus is the consumers' gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price, up to the equilibrium quantity. Producer surplus is the producer's gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price, up to the equilibrium quantity. Consumer surplus is represented by Area A and producer surplus is represented by Area B.

Chapter 4, Problem 11P

To determine

To Demonstrate:

On December 17^t^h, 2015 tickets for Adele’s highly anticipated U.S concert tour went on sale at ticket-master on a first come. First served basis. Throughout the day, a record 10 million people tried to purchase the 750,000 tickets available. In an attempt to prevent ticket scalping, Adele and Ticketmaster limited buyers to four tickets per concert and require that premium seat holders present the credit card used to purchase tickets to get into the concert. Despite these attempts to restrict resale, tickets on secondary Sites like Stub-Hub were selling for ten times their face value.

Diagrammatically, the supply-demand situation for the tickets of the music concert, the equilibrium price, output and the shortage. (Assume all tickets cost $150)

The consumer and producer surplus.

Explain how reselling tickets on secondary sites can increase consumer surplus.

Concept Introduction:

Consumer Surplus:

The difference between the price that the consumers are willing to pay for a unit of a product and the price they actually pay.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Definition Definition Consumer surplus is the consumers' gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price, up to the equilibrium quantity. Producer surplus is the producer's gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price, up to the equilibrium quantity. Consumer surplus is represented by Area A and producer surplus is represented by Area B.

Chapter 4, Problem 11P

To determine

To Demonstrate:

On December 17^t^h, 2015 tickets for Adele’s highly anticipated U.S concert tour went on sale at ticket-master on a first come. First served basis. Throughout the day, a record 10 million people tried to purchase the 750,000 tickets available. In an attempt to prevent ticket scalping, Adele and Ticketmaster limited buyers to four tickets per concert and require that premium seat holders present the credit card used to purchase tickets to get into the concert. Despite these attempts to restrict resale, tickets on secondary Sites like Stub-Hub were selling for ten times their face value.

Diagrammatically, the supply-demand situation for the tickets of the music concert, the equilibrium price, output and the shortage. (Assume all tickets cost $150)

The consumer and producer surplus.

Explain how reselling tickets on secondary sites can increase consumer surplus.

Concept Introduction:

Consumer Surplus:

The difference between the price that the consumers are willing to pay for a unit of a product and the price they actually pay.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Definition Definition Consumer surplus is the consumers' gain from trade. The consumer surplus is the area below the demand curve but above the equilibrium price, up to the equilibrium quantity. Producer surplus is the producer's gain from trade. The producer surplus is the area above the supply curve but below the equilibrium price, up to the equilibrium quantity. Consumer surplus is represented by Area A and producer surplus is represented by Area B.

Chapter 4, Problem 11P

To determine