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Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383

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BuyFindarrow_forward

Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383
Textbook Problem

Think of ticket scalpers at a rock concert, a baseball game, or an opera. Might they exist because the tickets to these events were originally sold for less than the equilibrium price? Why or why not? In what way is a ticket scalper like and unlike your retail grocer, who buys food from a wholesaler and then sells it to you?

To determine

Ticket scalpers.

Explanation

Yes. The selling of the tickets at lower equilibrium price gives an opportunity for the ticket scalpers. The number of the tickets or the supply is fixed when there is an excess demand. However, the price of all tickets would be fixed, and this creates disequilibrium for the tickets. If the tickets are sold at the equilibrium price, there will not be any shortage for the tickets. However, underpricing leaves an opportunity for the ticket scalpers who buy the tickets in bulk at a lower price and resell them at a higher price. In this context, the ticket scalper acts like a retail seller...

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