Problem
Fans of rock and rock stars often bemoan the high price of concert tickets. One superstar has argued that it isn't worth hundreds, even thousands, of dollars to hear him and his band play. Let's assume this star sold out arenas around the country at an average ticket price of $75.
a. How would you evaluate the argument that ticket prices are too high?
b. Suppose that due to this star's protests, ticket prices were lowered to $50. In what sense is this price too low? Draw a diagram using supply and demand curves to support your argument.
c. Suppose the rock superstar really wanted to bring down ticket prices. Since he and his band control the supply of their services, what do you recommend they do? Explain using a supply and demand diagram.
d. Suppose the band's next album was a total dud. Do you think they would still have to worry about ticket prices being too high? Why or why not? Draw a supply and demand diagram to support your argument.
e. Suppose the group announced their next tour was going to be their last. What effect would this likely have on the demand for and price of tickets? Illustrate with a supply and demand diagram.
The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.