Exhibit 3-16 Refer to Exhibit 3-16. If there are empty seats for a basketball game at the price P*, the situation is best depicted on graph A)(1), with P* = P₁. B)(2), with P* = P₃. C)(3), with P* = P₂. D)(3), with P* = P₃. E)(4), with P* = P₁.

Question

Quizplus · Accepted Answer

The intersection of the demand curve (D1) and the supply curve (S1) at point B12 represents the equilibrium price and quantity for the game. If there are empty seats, the demand curve would shift to the right, and the new equilibrium would occur at point B0. The price at this point corresponds with P* = P₂. Therefore, the situation is best depicted on graph (3), and the correct answer is choice C.

Exhibit 3-16 Refer to Exhibit 3-16. If There Are Empty Seats for Empty