Economical Analysis

20. (TCO 2) Refer to the information and assume the stadium capacity is 5,000.  The supply of seats for the game

Price per Ticket 

Quantity Demanded 

 $13

 1,000

 11

 2,000

 9

 3,000

 7

 4,000

 5

 5,000

 3

 6,000

(Points : 3)

      Varies inversely with ticket prices.      Varies directly with ticket prices.      Is perfectly inelastic.      Is perfectly elastic.

The supply of seats for the game is perfectly inelastic. It is because the supply is fixed to 5000 seat, the price change affects the quantity demanded and not the supply in terms of the capacity of the stadium.

22. (TCO 3) the following cost data are for a firm in the short run:

Output 

 Total Cost

 0

 $400

 1

 500

 2

 550

 3

 600

 4

 650

 5

 700

What is the firm's average variable cost at an output ...