Market_Equilibriating_Process

Running head: MARKET EQUILIBRATING Market Equilibrating Eric Ishihara University of Phoenix Eco 561 DBA09MBA07 Professor Amarjit Singh Diamond Bar Learning Center June 10, 2010 Market Equilibrating My family has been University of Southern California football season ticket holders the past fifteen years. This is a result of many members of my immediate and extended family having attended the university. Also, my father has been friends with the athletic director for over fifty years. As a result my father purchased football season tickets, when his friend was first appointed the position. At the time the USC football team was mediocre, and had lost a lot of appeal from the Los Angeles fan base. With their appeal down, this caused a smaller demand in football tickets for home games. As a result, my father’s friend convinced my dad to purchase season tickets for the upcoming football season. My father complied and was given seats that usually would be offered to season ticket holders with at least twenty-five years of continually season tickets. After several seasons the USC football program began to improve and as of today they are considered a national title contender every year. When we first became season ticket holders the football stadium was half full at best, with many of the fans current students and alumni. Due to the football teams mediocrity there was not a high demand for tickets. As their success went up, so did the demand for football tickets. USC football tickets had seen a change in demand, a change in demand is when there is a change in one or more of the determinants of demand. The basic determinants of demand are consumers’ tastes, the number of buyers in the market, consumers’ income, the prices of related goods, and consumer expectations (McConnell, Brue, & Flynn, 2009, p. 48). The success of the football program caused more people wanting to buy football tickets for games. Also, the success made USC football a preferred school for Southern Californian residents to cheer for again. The people in this area tend to follow and support teams in the area that traditionally succeed. An example is the Los Angeles Lakers, who continually win games that creates a large demand for game tickets, which sells for a high dollar amount. The supply for football game tickets was large when the team was not doing well. However when the team began having better seasons, the supply of tickets became scarcer. Also the supply of tickets for football games is limited, to only the number of seats in the stadium. So with a ceiling on the number of tickets, this contributed to the price of tickets to change. This caused changes in supply, demand, and equilibrium. Since there was a decrease in supply and an increase in demand this caused an increase in price (McConnell et al., 2009, p. 57). During these successful years for the USC football program, the price for season tickets escalated over 300% over the time from when we first purchased them. My experiences as a USC season ticket holder, has shown me the meaning of the Law of Supply and Demand. When we first became season ticket holders to now, I have seen the supply and demand for football game tickets go from a commodity you could give away, to today where it is the “hottest” ticket in town. I greatly appreciate the opportunity of having an excess supply of something and seeing the demand for this today. Reference McConnell, C. R., Brue, S. L., & Flynn, S. M. (2009). Demand, Supply, and Market Equilibrium. In Introduction to Economics and the Economy (pp. 45-71). New York, New York: McGraw-Hill Irwin.