Multiple Choice Quiz


1	When comparing the activities of ticket brokers and ticket scalpers, economists generally note
		A)	that there is no economic difference in what they do.
		B)	that ticket brokers perform a clear service while scalpers do not.
		C)	that ticket scalpers perform a clear service while brokers do not.
		D)	that both ticket scalpers and brokers are immoral.


2	For an event in a facility with a fixed amount of seating the
		A)	marginal cost curve is likely to be an upward sloping line.
		B)	marginal cost curve is likely to be a flat line up to capacity and a vertical line at capacity.
		C)	marginal revenue is likely to be upward sloping.
		D)	demand is likely to be horizontal.


3	The economic model that most fits for the promoter of an event is the
		A)	model of perfect competition.
		B)	monopoly model.
		C)	perfectly elastic demand model.
		D)	oligopoly model.


4	The profit maximizing price for an arena
		A)	is, by definition, the price that sells out the facility.
		B)	is quite likely to be lower than the capacity price.
		C)	could easily be above the capacity price.
		D)	is the price horizontally across from the point where marginal cost crosses marginal revenue.


5	Looking strictly at the profit-maximizing monopoly model of ticket sales
		A)	there should be no event that is not sold out.
		B)	sellouts should be the norm.
		C)	sellouts should be rare.
		D)	sellouts should never exist.


6	In the "perfect" arena for an event
		A)	the marginal cost will be below the marginal revenue at capacity.
		B)	the marginal cost will be above the marginal revenue at capacity.
		C)	the marginal cost will equal the marginal revenue at capacity.
		D)	the marginal cost will cross demand at capacity.


7	If anti-scalping laws are fully enforced and people obey the law then there will be a
		A)	shortage if the face value price is below the market price.
		B)	surplus if the face value price is below the market price.
		C)	shortage if the face value price is above the market price.
		D)	net gain to society from the situation where scalping is legal.


8	For scalping markets to exist
		A)	face value must be above market equilibrium.
		B)	face value must be below market equilibrium.
		C)	face value must be at market equilibrium.
		D)	it must be legal to sell tickets above face value.


9	Promoters may charge less than the profit-maximizing price because
		A)	the talent they hire may be willing to take less money in exchange for ticket prices that induce a sellout.
		B)	the promoters cut from memorabilia sales may more than make up for lost ticket profits.
		C)	they may not have good information about what ticket prices should be and chose a low-risk lower price strategy.
		D)	all of these


10	The effect of anti-scalping laws is that
		A)	there is no scalping.
		B)	there is scalping at all events.
		C)	scalping is diminished and society is better off.
		D)	scalping is diminished and society is worse off.

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