1. Suppose that the income elasticity of demand for tickets is +2.5. Also assume that the average household in the community makes the $20,000 per year and that about 6000 tickets are sold per year. Now let the average household income go up to about $22,000 per year. Now determine how many tickets do you expect to be sold in a year?
2. There is also the possibility of attending ice hockey games, for which tickets are $8.00 in addition to basketball games. Assuming cross-price elasticity (percentage change in demand for basketball tickets per percentage change in hockey ticket prices) of +1.5, explain what will happen to attendance at the basketball games if hockey tickets rise to $10.00 per ticket? By discuss how much will there be the rise/fall in attendance at basketball games? Are hockey games a substitute for basketball games or a complement? Why?