Milwaukee Brewers are playing their archrival the Chicago Cubs. Bleacher tickets
ID: 1188317 • Letter: M
Question
Milwaukee
Brewers are playing their archrival the Chicago Cubs. Bleacher tickets for the
game were sold out and many fans would have attended if tickets were available?
1.
Draw the demand and supply lines for bleacher tickets for this
game. Label the equilibrium bleacher price and the current bleacher price.
(Hint: You can use the drawing tools in Word to draw a demand and supply line.)
Label the equilibrium price and state whether the actual price is above or
below equilibrium.
2. What is the main rationing mechanism to allocate tickets for the game?
Explanation / Answer
Student Reading
Scarcity is the basic economic problem %u2013 limited resources and unlimited wants and needs. Evidence of scarcity can be seen everywhere and the 2009 Presidential Inauguration is no exception. With only days remaining until the swearing in of Barack Obama, people are scrambling to get their hands on one of only 250,000 tickets available to what may prove to be the most popular presidential inauguration of our time.
So the economic question at hand is how to allocate these scarce tickets. In a market economy, scarce goods and services are usually rationed by price, but there are other mechanisms. For example, the tickets could be distributed by the government based on need or merit. The Joint Congressional Committee on Inaugural Ceremonies could hold a lottery or conduct a contest to determine who gets tickets. Or they could announce %u201Cfirst-come-first-served%u201D with the line starting at the White House gate at 4a.m.! Strong, powerful individuals might like the tickets to be allocated by rule of force. Wealthy people might wish for an auction with tickets going to the highest bidders. It%u2019s far-fetched, and most people wouldn%u2019t like it, but the committee could even decide to give the tickets away to those with some arbitrary distinction such as age or height or hair color.
Read the following articles to see what the Joint Congressional Committee decided. What is the official decision about allocation of the scarce tickets to Barack Obama%u2019s Presidential Inauguration? Oh, and by the way, pay attention to any hints in the articles about unofficial methods of allocation.