Suppose There Are 100 Consumers with Identical Individual Demand Curves

question 77

Multiple Choice

Suppose there are 100 consumers with identical individual demand curves. When the price of a movie ticket is $8, the quantity demanded for each person is 5. When the price is $4, the quantity demanded for each person is 9. Assuming the law of demand holds, which of the following choices is the most likely quantity demanded in the market when the price is $6?

• A) 700
• B) 1,200
• C) 400
• D) 1,000

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Definitions:

External Benefit

A positive effect experienced by unrelated third parties resulting from a transaction or activity.

Subsidizing

The act of a government or organization providing financial support to reduce the cost of goods or services, often to encourage production or consumption.

External Benefit

A benefit that affects parties other than the buyers or sellers involved in a transaction, similar to a positive externality.

Traffic Congestion

A condition on road networks that occurs as use increases, characterized by slower speeds, longer trip times, and increased vehicular queuing.