It is common for people to wait in lines, sometimes even overnight or for days,

Question

It is common for people to wait in lines, sometimes even overnight or for days, in order to buy tickets for sporting events or concerts or for special sales (such as “Black Friday”). At MSU, students “camp out” overnight for season basketball tickets.

4i. If consumers wait in lines for a substantial time to make a purchase, which of the following is true? Circle or identify all that apply.

a. The price is below the market-clearing level.

b. The sellers could set higher prices.

c. The price is less than the opportunity cost of the purchase.

d. All of the above are true.

e. None of the above is true.

4ii. Student basketball tickets at Duke University are “free” and are given out on a first-come, first-served basis for each game (there is a line). If Duke decided to sell tickets to students instead (for money), which statements are correct? Circle or identify all that are correct.

a. Students from richer families would be better off.

b. Students who want to study a lot would be better off.

c. All students would be worse off.

d. None of the above is correct.

Explanation plzzz

Explanation / Answer

1st Option A& C are correct products are sold less then the market clearing market. The opportunity cost is to wait and forgo same time invested some where and earn more.

2nd option is All students would be worse off. This is the price or an opportunity cost a student earns when they wait , stand in a line and earn this ticket. If they tickets are readily avalible and free then the tickets will no longer be desirable and an essetial commodity, all students will forgo and readily availble things to a more desirable opportunity.

Related Questions

Navigate

• Browse (All)
• Browse I
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.