Suppose that Rihanna sells 1,000 tickets to a concerts at $480 each. If the equilibrium price is $600 per ticket for a fixed supply of 1,000 tickets, what is the value of the additional economic rent that Rihanna could earn if she charged the market clearing price?

Question

Quizplus · Accepted Answer

The additional economic rent Rihanna could earn is calculated by the difference between the equilibrium price ($600) and the price she charged ($480), multiplied by the number of tickets (1,000). This equals ($600 - $480) * 1,000 = $120,000.

Suppose That Rihanna Sells 1,000 Tickets to a Concerts at $480