Final answer:
The decrease in ticket prices from $45 to $23 suggests a strategy to attract more customers due to a possible decline in event popularity, aligning with the concept of price elasticity of demand.
Step-by-step explanation:
The pricing strategy suggested by Robert's tickets decreasing in value from $45 to $23 as the season went on is likely a reflection of a decline in the popularity of the event. This scenario is indicative of an attempt to attract more customers by discounting the tickets, which is often a reaction to initially overestimating demand or experiencing unexpected lower interest in the event. According to principles of price elasticity of demand, if the demand for the tickets is elastic, lowering the price would lead to a larger percentage increase in tickets sold, potentially increasing the total revenue.
However, if the demand is inelastic, a higher price could potentially generate more revenue despite selling fewer tickets because the percentage drop in quantity demanded would be less than the percentage increase in price. Therefore, if a band playing in an arena with 15,000 seats faces a downward-sloping demand curve, they must determine whether their demand is elastic or inelastic to set the ticket price that maximizes their total revenue and thus, their profit, considering their costs are fixed.