Final answer:
If people are offering more than $50 for a concert ticket, it suggests an excess demand at the Ticketmaster price, indicating a price below the equilibrium where demand and supply would equal. The scenario underscores the importance of understanding the price elasticity of demand in pricing strategies.
Step-by-step explanation:
If people are offering to pay you more than $50 for your concert ticket at the venue, it is probably true that there is an excess demand for tickets at the Ticketmaster price. This situation indicates that the price set by Ticketmaster was below the equilibrium price, where the quantity demanded would equal the quantity supplied. At an equilibrium price, there would not be people outside willing to pay more for a ticket because enough tickets would be available at the price they were willing to pay. In the context of concert ticket pricing, it is helpful to consider concepts such as price elasticity of demand.
Price elasticity of demand measures how much the quantity demanded of a good responds to a change in the price of that good. In the case of concert tickets, if the demand is elastic, cutting prices would lead to a larger percentage increase in the quantity sold, potentially increasing total revenue. Conversely, if the demand is inelastic, a price cut could lead to a smaller percentage increase in quantity sold, which might lower total revenue. The decision to adjust prices depends on the elasticity of demand at the initial price point.