Suppose average movie ticket prices are $8.50 and attendance is 1.2 billion. The price of tickets rises
Question:
Suppose average movie ticket prices are $8.50 and attendance is 1.2 billion. The price of tickets rises to
$9.50 and attendance rises to 1.4 billion.
a. What happened to total revenue?
b. If you were to estimate elasticity from these figures, what would your estimate be?
c. What provisos would you offer about your estimate of elasticity?
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a To calculate the total revenue you can use the formula Total Revenue Price x Quantity Initial Tota...View the full answer
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