Answer :
The relationship between ticket price and average attendance in baseball is an example of price elasticity of demand, indicating a negative correlation. The fan price index helps to gauge changes in game attendance costs over time by comparing them to a base year.
The relationship between ticket price and average attendance for a baseball team is an example of price elasticity of demand. This economic principle illustrates how the quantity demanded of a product changes in response to a price change. When the ticket price was lowered from $12 to $11, the average attendance increased from 29,000 to 33,000. This suggests a negative correlation between price and attendance; as the price decreases, the attendance increases.
Calculating the fan price index for different years allows us to understand how the cost of attending a game changes over time. To determine the fan price index for a certain year, we compare the current market basket's total cost with the base year's total cost. For example, with the average market basket costing $191.92 in 2008 and seeing an increase to $197.35 in 2011, we can calculate the index for 2011 using 2008 as the base year.
Fan price index for 2011 using 2008 as base year would be calculated as: (Market basket cost in 2011 / Market basket cost in 2008) imes 100. This index gives us an insight into inflation and changes in the cost of attending a baseball game.
