Suppose there are 100 people with identical demand curves. When the price of a movie ticket is $8, the quantity demanded by each person is 5 tickets. When the price is $4, the quantity demanded by each person is 9 tickets. Which of the following is the most likely quantity demanded for the market as a whole when the price is $6?

Question

Quizplus · Accepted Answer

The quantity demanded increases as the price decreases, indicating a negative relationship between price and quantity demanded, typical of demand curves. At $8, the total quantity demanded is 500 (5 tickets per person * 100 people), and at $4, it's 900 (9 tickets * 100). A price of $6 is midway between $8 and $4, so it's reasonable to expect the quantity demanded to be midway between 500 and 900, which is 700 (7 tickets per person * 100 people).

Suppose There Are 100 People with Identical Demand Curves